London City Airport to launch homegrown FBO

 - November 27, 2007, 11:01 AM

London City Airport (LCY) has decided to go it alone with the development of a new business aviation facility, having failed to reach agreement with any of the 10 or so FBO groups known to have bid for a proposed build-and-operate deal. In an August 17 statement, privately owned LCY said that the new London City Airport Jet Centre will be open early next year, offering full handling services to the growing number of business aircraft using the downtown gateway.

As of early last month, Signature Flight Support was understood to be the only remaining contender in the bidding for the new FBO. According to sources involved in the process, some nine other companies had their bids rejected or had withdrawn their offers, leaving the LCY management to negotiate exclusively with Signature, which also has FBOs at Luton, Southampton and Oxford Airports, as well as at Paris Le Bourget.

However, several of the bidders complained to AIN that London City’s terms are not commercially viable for the prospective FBO since the forecast is based on inflated traffic predictions. The asking rate for the executive handling facility lease was reportedly $90 per square foot.

In 1999 there were about 2,500 business aircraft movements and around 7,000 per annum are expected by 2010. According to LCY, this part of the airport’s traffic has increased by 252 percent since 1995.

The contract award was to have been made by July, with a view to operations beginning in December. Signature has been providing handling at the airport for several years using a satellite operation staffed by its Luton personnel. This contract will come to an end on December 1, leaving LCY to take full responsibility for executive handling.

The Jet Centre will include passenger and crew lounges, immigration and Customs facilities and an adjoining business aircraft apron. LCY’s management has made a commitment to staff the facility with specially trained personnel to provide all aspects of flight planning and ground handling for executive operators.

Growth of business aviation at London City has been impeded by a lack of peak-hour capacity and the tough operational approval requirements associated with the airport’s 5.5-deg steep approach and 3,900-ft runway. The airport is to extend ramp space at the western end of the site to allow more air-craft to be parked overnight for early-morning departures.