Cost model: Airport terminals

Introduction

Air traffic has grown exponentially over the past decade. UK passenger numbers totalled 189 million in 2002 and are forecast to grow to at least 350 million by 2020, and possibly as high as 480 million.

In response to forecast growth and with government support, airport operators are planning and implementing substantial investment in additional capacity. The most dynamic sector has been budget airlines, in which passenger numbers grew 300% in the five years to 2005.

In addition to expansion, existing facilities such as security need to be upgraded to meet new requirements and counter obsolescence.

However, the combination of an economic downturn and high oil prices will undoubtedly challenge the business model of many airlines and the airports they serve. For airport operators, there will be greater pressure on landing charges and operating costs. In providing a high-quality service for passengers, any new terminal investment will need to balance the scale of initial capital investment, provision for future expansion and operational efficiency, together with the imperative to maximise revenues from all available income streams.

The economic case for further expansion is described in the 2003 white paper, The Future of Air Transport. Air travel underpins the UK’s exports and its general business performance, as well as making a significant contribution to tourism. Air transport has also had an important social role in reducing the cost and time of long-distance travel.

The white paper acknowledges that continued investment should be balanced against the environmental effects of expanded air travel, an issue that, clearly, has not been resolved.

In the meantime, BAA is well advanced in the implementation of a £6bn investment programme to follow on from Terminal 5, and other operators in the private, public and PPP sectors are preparing major programmes for regional facilities in locations such as Manchester, Birmingham, Liverpool and Leeds Bradford.

Types of airport terminal

Air travel has become increasingly segmented, with budget airlines introducing new sets of requirements for fast terminal turnaround and minimal service. The types of flights and airlines served will determine many of the principal design features of a terminal, including airport-wide services, baggage handling, apron (area designed for loading and unloading passengers and cargo) and gate design, and retail.

The main requirements of the different service types are as follows:

• Full-service airlines. These typically require pier/gate service and dedicated facilities for premium passengers. Full-service flights have longer turn-around periods and often run an “open gate” boarding policy, which reduces the need for holding space at the gate. The quantity and size of baggage is likely to be high and the security profile of some destinations may result in more bags progressing to higher levels of screening
• Budget airlines. These work on a model of maximum throughput and minimal operating cost. Passengers are held at gates prior to boarding but few gate services are required. Minimising turnaround time is vital. Discouraging hold baggage simplifies apron operations but places more pressure on passenger and hand-luggage screening. To simplify landside operations, budget carriers encourage e-ticketing and remote check-in
• Charter flights. These have a profile of high baggage loads, longer turnarounds and limited passenger service. Passengers also require extensive, off-airport long-term parking. Within the terminal, the key issue related to charter flights is their contribution to peak flows at holiday times – determining the sizing of many aspects of airport equipment.

Client requirements for terminal facilities

Airport facilities are developed to respond both to existing levels of demand and future growth in traffic. Investment is targeted at attracting two key clients – passengers and the airlines that serve them.

Passengers typically choose their preferred airport on the basis of the availability of routes, services and pricing, so being successful in attracting the right airlines and routes is critical to commercial success.

Important factors for passengers also include: location; ease of access; and the range of services provided. However, if the right flights are not on offer, passengers will not come.

Key considerations in attracting airlines include: accessibility; the size of the local market; the availability of runway capacity; the presence of competing airports and airlines; the levels of landing charges; the speed of turnaround at the stand; and the services available to passengers.

In response to the twin requirements of passengers and airlines, developers will seek to address and balance the following brief requirements:

Passenger requirements

 

 

 

• Stress-free experience, including avoidance of queues
• Ease of access, with good parking, public transport and hotel infrastructure
• Quick processing times for security and baggage collection
• Short travel distances and direct, single-level access to departure gates
• Up-to-date flight information and clear way-finding
• Targeted retail and catering that meet the needs of different groups
• Facilities and information for meeters and greeters.

Airline requirements

• Capacity to respond to changing flight schedules and fleet
• Failsafe operation of systems
• Flexibility to respond to changing business needs
• Cost-effective design solutions to minimise landing charges
• Clear process routes through departure and arrivals to prevent departure delays
• Well-organised apron services to minimise turnaround time.

The airport operator will also have its own development priorities. These include: the optimisation of revenue generators such as retail; security provision; and the achievement of value-for-money investment through phasing the delivery of capacity in fixed assets such as security and baggage systems.

Third-party requirements associated with security, airport services, passenger services and back-of-house provision must also be accommodated.

Design issues

Capacity

Terminals are being designed to accommodate sustained expansion, which may involve a phased development of baggage handling, gates and stands.

Capacity is determined by two main variables: total annual passenger flow and peak passenger flow. Total flow is used to calculate departure and airside space allowances, while peak flow is used to size elements linked with passenger processing such as security, check-in and baggage handling. In the UK, the design standard adopted is the 30th peak busy hour.

Level of service

International bodies including the International Civil Aviation Organization and the International Air Transport Association assess performance for check-in, security, queuing times and so on. These are used to justify landing charges, and are a key element of competition between hubs.

Passenger experience

Important aspects to manage include:

• Rapid completion of check-in and security. Clearing security is a major source of stress, so an efficient process will make a major contribution to the passenger’s experience.
• Clear way-finding and orientation. Terminal buildings have become larger and more complex, with multiple piers and gates. Ease of navigation, direct routes to gates and information on travel times to gates also reduce stress and help to give more time for passengers to use airside facilities.

Humanising the scale

Terminal buildings are necessarily large, but a clear layout, well-signalled navigation features and high-quality signage all help to mitigate the scale. Repeated elements of structure or colour break up very large spaces into smaller, more easily understood units, as do repeated design features at a variety of scales.

Security

Baggage-handling and hold baggage screening are the principal elements of the security system, but other elements include personnel screening, physical security elements such as barriers, the rationalisation of circulation routes, the provision of clear lines of sight and the consideration of blast resistance in the structural design.

Transit systems

For larger terminals and piers, transit systems become necessary when distances exceed 300m. In addition to the cost of the travelator system itself, the impact of increased circulation requirements on the footprint of the building also needs to be taken into account

Retail offer

Airport retail differs from high street shopping in that customers are captive and are passing through a process. Some terminals are designed to direct passenger flow through the retail offer. Optimising footfall and retail frontage is important, as is avoiding cold spots in the flow of passengers around the terminal. In some terminals, the food and drink offer is treated as the anchor destination and retail is planned around it.

Baggage handling

The key elements of a baggage handling system design are:

• A 100% secure environment – baggage flow from check-in to aircraft loading has to be completely secure.
• Capacity and flow rates – the time of check-in closure is determined by the worst-case processing time for bags through all levels of security. The typical time for a bag to pass directly through screening and straight onto the aircraft is about 12 minutes. Meeting target times depends on capacity of the first stage of hold baggage screening through which all bags pass – the latest machines typically have a capacity of 1,800 bags per hour
• The adopted baggage screening protocol – this varies between countries and in the UK involves a five-stage sequence of increasingly sophisticated scanning techniques, including X-ray and CT scanning processes. Many of these processes are automated, but input from specialist operators is required at defined stages in the process.

The main drivers for sizing a baggage system are:

 

 

 

• The peak busy hour passenger flow
• Aircraft size
• Flight type – different types of flight have different load characteristics
• Bag profile – based on destination, flight type and other factors, the risk profile of baggage and the profile of scanning operations can be determined.

Other cost drivers for baggage systems include:

• Redundancy and failsafe provision – particularly for explosives detection systems and baggage sortation machines, which have high costs
• Load-sharing systems – these enable baggage to be directed evenly across all scanning lines so that all elements of the system are utilised, maintenance can be carried out without disruption, and mechanical systems wear at the same rate
• Management information systems covering bag tracking, processing times and other operational key performance indicators

Building services installations

The large scale of terminals means that in public areas there are few significant sources of heat load other than the building occupants. This source fluctuates considerably in response to peak travel hours, so a responsive ventilation system is essential. Low-level displacement ventilation has become common, as comfort conditions need to be maintained only in the passenger zone, and systems can take advantage of large building volumes for high-level extraction of exhaust air.

System capacity has to be designed to cope not only with anticipated traffic levels but also with the consequences of flight disruption and the like. Design of air movement in public areas also needs to take account of smoke extraction and control.

Shared airport systems such as common user terminal equipment (CUTE) and flight information are increasingly run across a common fibre-optic IT backbone using internet protocols. While the distribution installation is simplified and more scalable, the actual on-site addressing of systems is highly complex and needs an extended installation and commissioning programme. Use of the common backbone also permits easier integration and reconfiguration as the building adapts to new requirements.

Project management and procurement

The complex operations found particularly when working in restricted airside zones create a wide range of additional cost drivers.

Security clearance is a key issue, particularly with airside working, and makes the processing of personnel and deliveries potentially subject to long delays. Contractors tend to use established supply chains, which already have security clearance and trained operatives, although this may reduce competitive pressure in procurement.

As airside working adds significantly to project costs, sites should be configured wherever possible so that they can be managed as landside projects with conventional procedures.

Requirements and restrictions associated with airside working include:

• Higher costs of third-party legal liability insurance
• Cost of training associated with driving and works permits
• Maintenance of restricted zone boundary
• Control of airborne dust and debris to avoid ingestion by aircraft engines
• Vibration limits when working in proximity to sensitive buildings
• Remote facilities, including welfare, administration, storage and parking, owing to pressure on airside space.

Other airport-specific constraints that can affect terminal design and construction include:

• Requirement of stakeholders, including the Department of Transport, customs special branch and so on
• Civil Aviation Authority (CAA) restrictions on permanent building heights within safety glide slopes
• Enhanced acoustic control and monitoring measures
• Prevention of electromagnetic interference and the minimisation of radar signatures
• CAA restrictions on crane heights within safety glide slopes and restrictions on the use of radios
• Out-of-hours working and phased development to minimise disruption to passengers and aircraft
• Controls on delivery and construction traffic to prevent airport road congestion.

Procurement of specialist equipment is another key consideration. Airport operators are adopting a range of alternative procurement routes in a continuing search for the optimum balance of risk and competitive pricing.

However, terminal development involves many specialist systems – such as baggage handling, air bridges and shared information systems – and these require specialist designto be completed alongside the initial design development. Two-stage approaches to the agreement of package contract sums enable design input and co-ordination to be secured during early stages of the project.

There are a large number of stakeholders involved in a terminal project, with interests ranging from security, passport and customs control, to the operational and commercial interests of multiple airlines. In a global industry, the security requirements of destinations such as the US may also need to be taken into account.

With so many interests to be reconciled, finalising and adhering to project briefs and securing strong decision-making is a challenge. Stakeholder management should be a key client responsibility but also needs to be facilitated by the project team.

Cost breakdown

The cost model features the new-build construction of a regional-scale airport terminal handling both domestic and international flights, with a gross internal floor area of 25,000m2. The costs in the breakdown exclude piers, air bridges and baggage-handling systems, as well as all costs of site preparation, external works, drainage and external services. The costs of CUTE are also excluded.

Costs are current in July 2008, based on a location in south-east England. The level of pricing assumes procurement on the basis of a two-stage competitive tender, with design responsibility for elements such as the curtain walling and engineering services being taken by specialists as part of a

pre-contract services agreement. Adjustment should be made to the costs detailed in the model to account for variations in phasing, specification, site conditions, procurement route, programme and market conditions.