The booming Phoenix-Mesa Gateway Airport has unveiled a $1.4 billion plan for a new passenger terminal that could open as soon as 5 years from now and eventually expand to 60 gates.
The airport is anticipating that rapid growth will continue with its focus on low-cost air travel, and that its continuously-expanding temporary terminal will soon reach capacity.
Gateway served almost 1 million passengers last year and is on track to handle 1.3 million this year.
Lynn Kusy, the airport’s executive director, said the projected need for such a massive terminal will likely surprise many people.
“We know we’d have to build it someday, but we didn’t know that it would come this quickly,” Kusy told the Tribune. “The passenger growth has been amazing, astonishing.”
The ambitious expansion plan seemed unthinkable just a few years ago.
Gateway was unable to lure airlines after the former Williams Air Force Base closed in 1993. When Allegiant started a few routes in late 2007, the demand surprised airport officials and the airline itself. Gateway began the study in 2010 because the airport will reach capacity soon.
“Within the next 5 to 7 years, we expect that we’ll need this terminal,” Kusy said.
The airport anticipates it can fund the expansion as passenger traffic generates more revenue, and through Federal Aviation Administration funding.
But the airport’s board of directors expressed concern upon seeing the plan for the first time Monday.
Member Thelda Williams said Gateway needs a backup plan so the new terminal can be built if FAA and other federal funds get bogged down in Congressional infighting.
“To me, it’s almost frightening in a way because of the condition in Washington,” Williams said.
Kusy warned that not building the terminal would come at a cost. Once the existing terminal reaches capacity, the airport will forgo $800,000 a year in revenue and the Valley will lose $20 million a year in tourism revenue.
The new terminal would rise on the airport’s now-vacant east side in four phases:
Phase I: A terminal with 14 gates would handle 3 million passengers a year and could be needed by 2014. It would cost $144 million.
Phase II: Four additional gates would boost capacity to 4.4 million passengers and offer more than 10,000 parking spaces. Cost: $145 million.
Phase III: Thirty gates and parking garages would expand capacity to 10 million passengers. The airport would plan for light rail service, but no date was set for this $963 million expansion.
Phase IV: The terminal would max out at 60 gates to serve 20 million passengers a year. This would occur after 2030.
The expansion will require the existing two airlines serve more cities, and probably additional airlines, Kusy said. Gateway hasn’t looked closely at whether projected revenue increases align with the expansion costs.
“We’ll see if we can skinny down the price a bit,” Kusy said. “The first thing we’ll do is reduce the cost. Then we’ll look at the funding.”
Gateway has revenue from a $4.50-per-ticket surcharge, the FAA, the Arizona Department of Transportation and the four communities that own the airport.
The airport estimates $385 million in private development will spring up on Gateway-owned property. It anticipates 2.5 million square feet of office, retail space and two hotels with 600 rooms. The terminal will support more than 8,200 non-airport jobs, Kusy said.
Gateway’s passenger count is now about 3 percent of the 40 million who use Phoenix International Sky Harbor Airport a year. The airport has the potential to become 10 percent as large Sky Harbor, Kusy said.
Gateway prepared the study with the Jacobs Engineering Group. Airport executives made a point of designing the site so it will retain some of the small-airport feel to ensure passengers can get in and out quickly without the hassles of major facilities, Kusy said.
And while Gateway wants a simple design to keep costs low for airlines and passengers, Kusy said the airport doesn’t want to go as far as building a cheap-looking terminal.
“The idea is the building need to reflect the needs of the community, and I think there will be a sense of pride in that building no matter how it turns out,” Kusy said.
Mesa Vice Mayor Scott Somers said the airport and surrounding cities must inform its neighbors about Gateway’s growth plans. Residents needs to know that the nearby vacant land will be transformed into an airport-centric community he’s often referred to as an “aerotropolis.”
“It’s going to turn decidedly urban,” said Somers, who is also on the airport’s board. “You can’t think of this as suburbia. You really need to think of this in terms of living by Tempe Town Lake or downtown Phoenix.”
By Garin Groff, Tribune
Posted: Monday, June 18, 2012 11:40 am