New terminal to strengthen Tel Aviv commercial revenue

Gavin Lipsith

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Tel Aviv Ben Gurion's international terminal opens on November 2 and is set to boost non-aeronautical revenues at the airport by over $40m a year

Israeli prime minister Ariel Sharon inaugurated the largest aviation project in the country's history?the $1bn terminal three?at Tel Aviv Ben Gurion airport last week. Israel Airport Authority (IAA) believes that successful commercial tenders at the facility, which opens on November 2, mean it will be entirely self-financing.

IAA director commercial and properties Yoram Shapira told RavenFox.com that commercial revenues at the international terminal would cover both the additional $60m annual operation costs it will incur and repayments on a 20-year project finance loan. The authority expects to generate over $40m more commercial revenue next year than in 2004 if traffic meets expectations. Commercial activities currently represent 53% of total airport revenue and are forecast to reach 55% next year, and 60% by the time passenger traffic?currently 6.8m a year?reaches 11m. Shapira added that growth was expected to surpass 5% each year if tourism prospects continue to improve.

"The income from tenders means we can run T3 for 10 years without raising aviation fees, whereas most airports raise fees when a new terminal is built," he said. "That is part of our strategy to attract more airlines and passengers to the airport."

See DFNI November 15 for more on Ben Gurion T3.