The Big Apple is a global leader in many respects, but its airports’ reputations are far from stellar. The three major NYC airports–JFK, Newark, and LaGuardia–are usually at the bottom of ranking lists for arrival timeliness and JD Power customer satisfaction. In November 2019, the Wall Street Journal bemoaned, “New York Airports–The Best at Being the Worst.” Derek Utter of the Port Authority of New York and New Jersey and its partners are determined to change that. ULI New York hosted a presentation and panel discussion on February 19th to discuss the current state of the public-private partnerships that aim to catapult NYC’s airports from the back to the front of the pack.

Last Wednesday, people filled the room at law firm K&L Gates to hear from Derek Utter, Chief Development Officer of the Port Authority; Dr. Gerard Bushell, Executive Chair of Terminal One Development and Chair of CAG Holdings, the airport investment platform of the Carlyle Group; Christina Callahan, Deputy General Manager of at LaGuardia Airport for the Port Authority; and Thomas Grech, President & CEO of the Queens Chamber of Commerce. Francisco Pineda, Academic Program Director and Lecturer of the Columbia University MS in Construction Administration, moderated the panel.

The presentation and discussion provided updates on construction project scope and timing. But moreover, the big-picture themes emerging from the discussion concerned the historic nature of the project, the project’s special status as a knowledge creation center, and the public-facing components of the project.

Historic Nature and Scope

The renovation of all three airports involves approximately $30 billion of public and private investment. This is the lion’s share of the $37 billion dollar capital plan that the Port Authority approved two years ago. Mr. Utter further framed the topic by stating “In the 100-year history of the Port Authority, we have never seen this level of investment, even in the 1940’s when the ports were being built.”

Dr. Gerard Bushell emphasized the JFK site “is a huge footprint…and huge opportunity to transform this area for many generations.”

The NYC airports are not only among the oldest in the country, but they also experienced record-setting passenger growth over the past several years as the economic recovery has coincided with a global travel and tourism boom.

The marquee elements of the airport investment plan are: redevelopment of LaGuardia ($8 billion), redevelopment of Newark ($2.7 billion), redevelopment of JFK ($13 billion), a new AirTrain for LaGuardia ($2.1 billion), replacing the existing AirTrain for Newark ($2.1 billion), and expanding the existing AirTrain for JFK ($500 million in initial planning funds). On top of that, roadways are being reconfigured to be more efficient for airport access.

The airport capital improvement project does not only involve modernizing the terminals, but also the AirTrains, the railway links that connect public transit to the airports. Currently 90% of passengers going to LaGuardia arrive by car, which is “incredibly high,” according to the Port Authority. The new LaGuardia AirTrain, the renovated Newark AirTrain, and the expanded (50% more capacity) JFK AirTrain, will also help the airports meet environmental sustainability goals to decrease carbon footprints.

Knowledge Creation Center

Panelists Christina Callahan and Dr. Bushell discussed the opportunity for the airports to learn from each other and be “laboratories” for airport construction and operations best practices. Ms. Callahan, as the Deputy General Manager of the LaGuardia airport, emphasized that the LaGuardia airport project is “truly a once in a lifetime opportunity” to build a brand-new airport on top of a fully functioning airport. As the LaGuardia project hits its major benchmarks and is about halfway done, it is “an incubator for new and innovative ways to manage a development program of this size in such a unique operating environment,” she said. She drew on her experience of 25 years overseeing the Syracuse airport redevelopment and doubling service as guiding her current role and being attentive to customer experience and community relationships.

Dr. Bushell and Mr. Pineda put the JFK redevelopment in perspective by comparing it to the equivalent of “two One Vanderbilts, or two One World Trade Centers, or one and a half Hudson Yards.” Speaking from his experience as former president of an infrastructure finance agency, Dormitory Authority of State of New York (DASNY), Dr. Bushell said municipal finance is the cheapest cost-of-capital source, and provides an opportunity for the private sector to deliver “more innovation and more partnerships.”

Due to the fact that LaGuardia’s renovation started first, the LaGuardia project teams can share best practices in constructions and operations to the other airports, and give a monthly “master class” on lessons learned. Airport security and integration of technology are also areas in which the airport teams are learning from international partners (airport operators and contractors from Europe, for example, who are working on the JFK project), and contributing to the “incredible laboratory and knowledge center” at JFK.

Public Components

The airport and AirTrain projects are not only inherently public usage and infrastructure projects, but also are job creation engines. Dr. Bushell likened the JFK airport to “a mini city” and Mr. Grech and Dr. Bushell spoke about the strategies that Queens Chamber of Commerce and the airport projects are using to meet Minority/Women-Owned Businesses (MWBE’s) contracting and vending target goals for these huge projects.

Mr. Grech discussed the experience he brought from international corporate experience such as RR Donnelly (a global printing and logistics company) helps him in his role today in prioritizing uplifting diverse talent in the Queens Chamber of Commerce and readying the local MWBE’s for bidding for contracts related to airport business. More advocacy with social media, expanding cultural competence trainings for LGBT-related workplace recruitment, and training local businesses to become more proactive and engaged were specific activities Mr. Grech cited in his current role.

Dr. Bushell, Mr. Grech, and Mr. Pineda also emphasized that MWBE hiring targets were, in their opinion, capacity-building for the local economy and not lip service to abstract diversity and social impact goals. It’s not just a “good thing, or right thing, but it’s about building capacity so that we are and have the best talent pool and the best opportunities for the best workforce for the best entrepreneurs,” Dr. Bushell noted, as he mentioned $1.5 billion of contracting will go to MWBE’s due to JFK redevelopment.

This event was made possible by ULI members and event champions Andrew Bauman, Amy Ironmonger, and Francisco Pineda. Many thanks to K&L Gates for hosting. If you have suggestions for ULI programming, please consider applying for a FY2021 leadership role or for the ULI New York Program Steering Committee.