Keflavik landlord names travel-retail subsidiary

Gavin Lipsith

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Leifur Eiriksson Air Terminal has established Frihofnin, its new retail subsidiary, in accordance with last year's decree from the Icelandic Competition Commission

Keflavik airport landlord Leifur Eiriksson Air Terminal has created a new retail subsidiary incorporating the company's existing retail operations at the airport and those gained when Leifur Eiriksson acquired rival Keflavik operator Icemart last year. The new company, Frihofnin, will be administratively and operationally separate from the landlord's airport's management business.

The move follows a decree by the Icelandic Competition Commission last year after Keflavik retail tenants complained that the landlord was awarding its own retail business the most profitable product categories and store locations. Leifur Eiriksson's acquisition of Icemart was also a result of that complaint.

Leifur Eiriksson is expected to announce new retail tenants this spring, and is in the process of deciding concessionaires from 30 shortlisted applicants. The tender covers about 1,150sq m (12,380sq ft) of retail space for categories other than those offered by Frihofnin, which sells liquor, tobacco, confectionery, cosmetics and electronics. The process was due to be settled by early 2003 but has been delayed by the long competition dispute. The contracts run for five to seven years with options to extend. A complete redesign of retail space at Keflavik is due to be completed in June.

Keflavik airport welcomed 89,000 passengers in February, up from 80,000 in the month last year. Originating and departing passenger numbers grew by almost 10%, while stopover passengers crossing the North Atlantic rose 21%.