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Herne Bay, England, CT6
United Kingdom
Community website for all things Herne Bay (Kent, UK). Covers: The Downs, Herne Bay Museum, Herne Bay Historical Records Society, Herne Bay Pier Trust, Herne Bay in Bloom, East Cliff Neighbourhood Panel, No Night Flights, Manston Airport, Save Hillborough, Kitewood, WEA, Local Plan and much, much more...
Filtering by Category: Infratil
Regular readers will recall that the last time KLM showed any interest in Manston, they were being lured by the promise of £600,000 - money which Manston and KCC were trying to prise out of the Government's Regional Growth Fund. The Government said "No", and KLM faded into the background. I do hope this new service isn't being subsidised from the public purse (national, county or district).
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No Night Flights home page
The New Zealand company which owns Prestwick has said there is no sign of a buyer for the airport, and its value has fallen. Infratil put its two UK airports, which include Kent, up for sale in March this year.
However it said the sales process for both had been "unsuccessful to date". As a result, Infratil said it had taken an impairment charge of £22m, which now values Prestwick at about £14.3m and Kent at £7.6m. Infratil said that it would "continue to seek a buyer for the airports and work with local stakeholders to review alternatives".
Together Prestwick and Kent's Manston Airport recorded losses for the six months to the end of September of just over £2m. Passengers travelling through the airports fell by more than 180,000 during the period compared to the same time in 2011, although freight business increased.
Prestwick airport has had several owners in recent years. In 1991 the newly-privatised British Airports Authority, BAA, put it on the market. In 1992 the airport was bought by Canadian businessman Matthew Hudson. He sold it in 1998 to transport group, Stagecoach. Stagecoach then sold it to Infratil in 2001 for £33.4m.
A significant percentage of the airport's aviation revenue is derived from freight and other aircraft activity, with business and property income also playing a significant role.
bbc.co.uk 13th Nov 2012
No Night Flights home page
In the 1990s Australia and New Zealand were amongst the first countries to sell state-owned airports and to allow their commercial operation. The resulting value uplift encouraged Australasian investors to look at markets where similar developments were occurring, which led to Europe.
Infratil invested in Prestwick, Kent and Lübeck airports and purchased an option over an airport near Berlin. These airports were acquired at well below replacement cost as rapid growth in European air travel made it likely that their capacity would soon become needed and valuable.
Kent for instance cost less than £20 million and the next London runway will cost over £2 billion (Mayor Boris Johnson’s preferred site in the Thames Estuary is likely to cost over £20 billion).
Notwithstanding this enormous potential, Infratil has now called it quits. European air traffic growth has slowed so that the need for additional airfield capacity is postponed, and Infratil’s assessment of the relative benefits of waiting (and continuing to meet operating cost) versus refocussing elsewhere have favoured exit.
No Night Flights home page
Let's have a quick look at the latest exciting news to come from Manston airport. The suggestion is that KLM's decision as whether or not to run a twice a day service between Manton and Schipol will be influenced (but not decided) by the response to Manston's online survey.
As influential local commentator Maurice Byford has pointed out:
Any business worth its salt would carry out due diligence, population and traffic analysis and SWOT analysis without resorting to a survey. You might want to ask, how many people travel to Europe from Kent, but then you need only look at the traffic figures from EuroStar train from to see the passenger footfall for Belgium.
There are plenty of reputable consultancies that specialise in providing detailed economic and demographic analyses to help businesses make rational commercial decisions. They have access to all the available data on business activities, income distribution and socio-economic groupings by post code. They have a pretty good idea how many people run businesses with European interests, and how many people are likely to take weekend jaunts to the Continent or connect to long-haul flights.
It is very likely that KLM have already done their homework, which is why they were looking for £600,000 of public money to underwrite the risk of operating from Manston. The online survey doesn't cover two of the questions that KLM most clearly need answered - how much will people pay, and how willing are they to accept KLM's offering (i.e. first thing and last thing, and nothing in between).
Airlines are high investment, high throughput, low margin businesses. They employ people full-time to examine every available business opportunity, and re-examine each option every couple of years. All of the major airlines will have examined and re-examined Manston over the years it has been owned by Infratil. With the exception of FlyBe's tentative experiment with a couple of minor routes (which failed for lack of passengers), there have been no takers.
KLM's interest in Manston may simply be that it is cheaper to park a plane there than at Schipol, and there's the possibility that the passenger fares would exceed the fuel costs to Schipol. In all probability, KLM will discover what others have discovered before them - Manston's catchment area cannot support a successful passenger or freight airport. It doesn't matter how keen the local residents or the local businesses are - there simple aren't enough of them.
After years of fanciful forecasts, missed targets and false hopes, this may be Infratil's legacy - a minimal passenger service that only ever flies at night, while the airport is almost entirely idle through the 16 hours of daytime. This is Infratil waving goodbye, with two fingers.
No Night Flights home page
In March 2012, Infratil announced that Manston was up for sale because it wanted to "refocus its investment profile" and concentrate on retail, production and supplying gas and electricity. What they didn't mention in their press releases was that Manston had lost them money hand over fist ever since they bought it.
In the previous couple of years Infratil had "written down" the value of its two European airports (Manston and Prestwick) from £70m to £36m. These write-downs were simply more realistic estimates of the actual value of the airports, in the light of their performance and the fact that they were losing Infratil about £6m a year.
Don't forget, dear reader, that Infratil is an infrastructure investment company. They buy and sell "big stuff" (putting it technically) to make money for their investors. On their website, Infratil state that "Infratil’s primary goal is to provide its shareholders with a consistent return of 20% per annum over the long term".
Clearly this 20% hadn't happened at Manston, and Infratil realised it wasn't going to happen soon enough to please their investors, if ever. So they decided to cut their losses.
But now we learn that Infratil are joining forces with Morrison & Co (the bank that owns a large chunk of Infratil) and a large pension fund to put in a bid for Stansted Airport. Stansted is owned by BAA, the largest airport operator in Britain, and the Competition Commission ruled some time ago that BAA owned to much of Britain's airport capacity and would have to sell some of it. BAA spent a lot of time and and money fighting this through the courts, but has finally accepted that it will have to sell Stansted.
This makes Stansted a very interesting purchase for a number of reasons. BAA also owns Heathrow, and has spent years carefully managing the mix of flights and carriers at the two airports to avoid them cannibalising each other's customer base. It hasn't been in BAA's interests to have Heathrow and Stansted competing with each other. Clearly, this will change when a new operator takes control of Stansted - there will be a massive increase in competition.
Stansted is well placed to take on new business. Throughout the recent hoo-hah about airport capacity in the south-east, one simple fact has been under-reported - there isn't a shortage of capacity in the south-east. BAA's own chief financial officer was reported as recently as April 2012 saying that Stansted is "only half full".
Both Stansted and Manston have spare capacity, long runways, and are in the "aviation-hungry" south-east. So why would Infratil balk at spending a few million a year at Manston, but leap at the opportunity to invest a BILLION in Stansted? The answer, of course, is in the question - it's the difference between "spending" and "investing". And this is also the answer to those who ask why not Manston.
Manston doesn't feature in any of the serious discussions about the future of aviation in the south-east (and it doesn't feature in Infratil's strategy) for one plain and simple reason - it's in the wrong place. If these two maps don't explain it clearly enough, have a look at this.
No Night Flights home page
A consortium led by an Australasian investment manager has emerged as an early rival to Manchester Airports Group in the £1bn battle for Stansted airport.
Morrison & Co, which operates out of New Zealand, Australia and Hong Kong, is heading a bid team that also includes the New Zealand Superannuation Fund and Infratil, a Wellington-based infrastructure investor.
Stansted was finally put on the block last month after a three-year legal fight by owner, BAA, which tried unsuccessfully to halt the forced sale of the airport demanded by the Competition Commission. BAA’s controlling shareholder, Ferrovial, is thought to have issued non-disclosure agreements last week to interested bidders, effectively kick-starting the process. The sale is being handled by Deutsche Bank and ING.
The interest of Infratil in Stansted has surprised some industry observers because it is currently trying to sell its two smaller British airports Glasgow Prestwick and Manston in Kent after a difficult foray into the UK aviation market. Infratil, which runs about £2.5bn of assets, has twice written down the airports in the past two years, with their carrying value almost halving from £70m to £36m today. The two airports lost around £6m last year.
Even so, Infratil is an experienced airport operator, with its interests including a 66pc stake in New Zealand’s Wellington Airport. Infratil’s operations at Prestwick have also enabled the company to develop a relationship with Ryanair the low-fare airline responsible for almost 70pc of Stansted’s traffic. The Morrison consortium is believed to have held early talks with Ryanair. The NZSF, which has more than £9bn assets, devotes about 9pc of the fund to infrastructure investment, spanning airports, transport, energy and oil.
The Morrison consortium faces early competition from the council-owned Manchester Airports Group, which is building up its firepower via a potential deal with Australia’s Industry Funds Management. The giant antipodean infrastructure investor, which has around £21bn under management, has agreed to inject about £1bn for a 35pc stake in the Manchester airport company on the condition it wins the bid for Stansted.
The Stansted auction, which may also attract interest from JP Morgan, Citi Infrastructure Partners and Morgan Stanley Infrastructure Partners, is complicated by the Government’s review of airport capacity in the south east, led by former Financial Services Authority chairman Sir Howard Davies. While there will be no decision on where to build a new runway before 2015, the recommendations of the Davies Commission could have a major impact on Stansted’s value.
Michael O’Leary, the Ryanair chief executive, can also influence how much BAA gets for Stansted. He has already expressed interest in taking a minority stake in any new owner of the airport as long as it agrees to lower both landing charges and the cost of building new facilities. Mr O’Leary has also attempted to drive down the price by declaring that any bid based on the airport’s £1.3bn regulated asset base the regulator’s proxy for its value is “artificial” and based on “Noddy land” economics.
telegraph.co.uk 22nd Sep 2012
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BBC 25th May 2012
Plans for night flights from Manston Airport in Kent have been opposed by Thanet District Council. At a meeting on Thursday, the Labour-controlled council voted against all night flights to or from the airport. Charles Buchanan, the airport's chief executive, said:
"We are disappointed the council is not supporting the airport as much as it could."
In March, owners Infratil announced plans to sell Manston and Glasgow's Prestwick Airport. Mr Buchanan said the airport wanted to run "a small number" of scheduled night flights. He said the owners had received legal advice that two flights per night, on average, did not constitute "an increase in activity over and above that which is already permitted", and they could go ahead without needing extra planning permission. Mr Buchanan said a number of companies were interested in taking up the opportunity.
"They would also bring the rest of their daytime schedule to the airport as well. Without that they'll go to airports where they have that flexibility."
Council research showed that 73% of some 2,000 residents questioned were against the proposal, citing potential noise levels and disturbance to sleep as their primary reasons for objecting. The airport currently deals with passenger and commercial aircraft with a runway capable of taking Boeing 747s and Airbus A380s. Its refurbished terminal is capable of handling up to 700,000 passengers a year.
Thanet Gazette 25th May 2012
MANSTON airport's plans to run as many as eight flights a night failed to get the support of Thanet District Council last night after a final crunch vote. Opinions divided along party lines at the extraordinary council meeting as the Labour administration motioned a rejection of the airport's proposals.
Council leader Clive Hart said the council's consultation response was based on the results of an independent review of the airport's proposals and the council's own consultation with residents. Conservatives argued that a vote against night flights was a vote against jobs for the area. Conservative group leader Bob Bayford said that a ban on all aircraft movements between 11pm and 7am was a "straight jacket" for the airport:
"At best it will delay the development of the airport, a worst it will kill the airport."
Mr Bayford added that it was "dangerous" for the council to base its response on a "seriously flawed" in-house consultation in which 73 percent of respondents opposed night time flying. Laughter came from the packed public gallery when Mr Bayford pointed out the Manston Airport's own consultation of residents showed 79 per cent being in support of night flights.
Mr Hart defended the in-house consultation saying it had the greatest response of any to date:
"The results have been extremely conclusive and it wasn't at all close."
The response stated the council's support of the day-time operation of Manston airport but said the council would not support night-time flying on the basis of its own consultation and the council-commissioned Parsons-Brinckerhoff report. Listing the objections, the report said the noise and environmental impacts had been underestimated by airport, the economic benefits of night flights were overestimated and that the impact on Thanet's tourism would be detrimental.
It also pointed to concerns raised in the World Health Organisation's assessment of the impacts of disturbed sleep and added that the night flight proposals had not considered Article 8 of the Human rights Act- the right to respect for private and family life.
The motion to adopt the response was won after Labour got the support of the council's two independent groups. The Conservatives voted unanimously not to support the response but were out-numbered. Phil Rose of the No Night Flights campaign and Charles Buchanan, chief executive of Manston Airport, watched the meeting from the public gallery. Mr Rose said:
"It is a good result and I am very, very pleased that the council came out following the recommendations of the independent reports. They have listened to the views of the people."
Mr Buchanan said the airport will take the vote into consideration and formulate its response:
"All we have ever asked for a limited number of night flights with mitigation measures. The result is disappointing but entirely predictable."
The council's response will not be binding as the council is only a consultee in Manston's own consultation of its night-time flying policy. A separate residents' petition against night flights, presented to the council last week, was also noted. It had collected 2682 signatures but only 777 were valid as the others did not include an address.
kentnews May 25, 2012
Manston Airport chiefs say they are “very disappointed” after Thanet District Council last night voted to oppose night flights from the Thanet airfield. As part of the consultation process, the council saw a heated debate over its position. The Conservatives on the council were open to the suggestion, while the ruling Labour group were opposed.
Speaking this morning, chief executive of Manston, Charles Buchanan, said:
We are clearly very disappointed by this stance as it is completely inconsistent with the council’s stated policy to support the airport’s success as a creator of thousands of much needed jobs. The position the council adopted last night is also in sharp contrast to its leader Clive Hart’s stated assertion of ‘the council’s recognition of Manston Airport as an economic asset to Thanet’.
The council’s response contradicts the conclusions of the report from its own consultant Parson Brinckerhoff, which identifies that a ban on night time flying, in relation to passenger services, would: ‘almost certainly prohibit a large number of potential carriers’. Its consultant also recognises that with respect to freight operations, the absence of night flights ‘would undoubtedly hinder the ability of Manston to attract either regular flights or a based operator’.
It is this ability to attract passenger and freight services that will fundamentally determine whether the airport is an economic asset for Thanet, as well as providing the travel advantages for local people using their local airport. Importantly, the council which has sought to question Manston’s own economic impact report, has once again contradicted the conclusions of its consultants own report into the impact of the airport, which stated that: ‘…we are satisfied with the approach and values used for the economic assessment’.
Given that Parson Brinckerhoff acknowledges that they themselves only have ‘some relatively minor queries’, we are very surprised that the council has adopted such a negative approach towards the airport and its economic impact assessment. We will now obviously consider the council’s response before providing them, as a consultee on night-flights, with a reasoned reply in due course.
kentonline May 25 2012
Plans for night flights at Manston airport have suffered a big setback after councillors voted against the idea. Cabinet members of Thanet District Council had already said they would not support the bid by Kent International Airport. However, a full council meeting last night formally opposed the idea of night flights.
Manston wants some planes taking off and landing between 11pm and 7am. Scheduled night flights were suggested at the airport to help increase air capacity. But councillors decided the proposed scheduled flights would be too noisy and have too great an environmental impact. A consultation found three quarters of people living nearby also did not want night flights.
Charles Buchanan, chief executive of Manston Airport, said:
We are clearly very disappointed by this stance as it is completely inconsistent with the council’s stated policy to support the airport’s success as a creator of thousands of much needed jobs. The position the council adopted last night is also in sharp contrast to its leader Clive Hart’s stated assertion of ‘the council’s recognition of Manston Airport as an economic asset to Thanet’. Ironically at a time when the government is recognising the role that Manston could play a part in supporting the south east, by making use of existing under-utilised runway capacity, Thanet is apparently rejecting the opportunity to build its economy and create thousands of jobs.
The immediate conclusion is that despite the council’s stated support for the airport, the leadership has refused to recognise the operational flexibility that its own expert identifies as being necessary for that success. One can only guess why they have chosen such a course and put at risk one of the engines for the long term prosperity of Thanet. We will now obviously consider the council’s response before providing them, as a consultee on night-flights, with a reasoned reply in due course.
No Night Flights home page
Night flights are not "make or break" for Manston airport, it will struggle regardless - that's the claim from Phil Rose of the No Night Flights group, which is campaigning against proposals to introduce scheduled flights between 11pm and 7am from Manston airport.
Mr Rose poured scorn on claims by the district's Conservative group that ending restrictions would improve the airport's fortunes. He said:
"It is not make or break. What is make or break for Manston is its location. The reason a series of carriers have pulled out, and the reason Infratil is selling the airport, is because of its location – surrounded on three sides by sea with a much smaller catchment area than other airports."
Mr Rose points out that not only does the successful London City Airport have no night flights but Prestwick Airport, also owned by Infratil and also up for sale, does. Norwich and Southampton Airports do not have night flights, except in exceptional circumstances. Other regional airports that have night flights include Southend which, despite seeing passenger numbers soar with the arrival of EasyJet this year, runs on average just over 400 night flights a year – 1.5 flights a night - far from the eight which Infratil's proposals would make possible.
On Thursday Thanet council will vote on whether to support Manston airport's night-flight policy. The submission was made to the authority last November. The council's draft response, was brought before the cabinet only last week after it was agreed with amendments by the authority's Overview and Scrutiny Committee.
It does not support night flights.
The report, written by the council's community services manager Madeline Homer, is based on the council-commissioned Parsons Brinckerhoff report. It also includes the results of a 28-day consultation in which residents were asked for their views. Shadow cabinet member, Tory Councillor Martin Wise has accused Labour of being "anti-airport" for supporting a total ban on night flights.
Both sides have accused the other of cherry-picking information from the Parsons-Brinckerhoff report.
Labour claim the council's report supports the consultants' view that the airport had underestimated the potential negative impacts of night flying and overestimated the economic benefit. Airport chief executive Charles Buchanan strongly disagrees. Mr Buchanan said the draft response did not recognise a significant element of the Parsons Brinckerhoff report which said "A ban on night time flying would almost certainly prohibit a large number of potential carriers". He added that the draft response ignored the fact the independent report said the airport's mitigation programme "goes further than that required by current Government guidance." The Conservatives agree with Mr Buchanan: the points made in the draft response were not borne out by the consultants' report.
No Night Flights, unsurprisingly, do not agree. Mr Rose said:
"Mr Buchanan is cherry-picking a few bits that are complimentary and it ignoring the vast majority of the report. The report pointed out that if Manston does not have night flights it does not prevent it from attracting new business. It said that not having night flights would deny it having just three per cent of its freight market. This alone will not decide the airport's fate."
Thursday's vote looks likely to be drawn down party lines, with Labour committed in its election manifesto to opposing night flights. The Conservatives have promised its members a free vote. With Labour holding the leadership of the council only by the support of one of the authority's two Independent groups, the decision of councillors Ian Driver, John Worrow, Jack Cohen, Tom King and Bob Grove would appear to be crucial.
thisiskent 18th May 2012
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News that Manston airport is up for sale is confirmation that the local infrastructure is not sufficient to sustain an airport, according to one of the most respected campaign group in the country.
Manston’s New Zealand owner, lnfratil, announced it was selling the site because it wanted to “refocus its investment profile" and concentrate on retail, production and supplying gas and electricity. The move puts 123 jobs at risk.
The Campaign to Protect Rural England says the sale is an ideal chance for Thanet council to put into force planning regulations protecting the interests of residents, particularly in the issue of night flights, which lnfratil wanted to introduce amid fierce local opposition. A CPRE spokesman said:
“Of course we are saddened to think that existing jobs at Manston might be put at risk, but it confirms our long-standing concerns that Manston has been unable to become a commercial success for many reasons, not least its lack of infrastructure. Manston airport has consistently struggled to attract passengers and airline operators despite the massive amount of investment into it.
If a fresh start means new operators are able to breathe new life into Manston, we sincerely hope Thanet District Council will take this as an opportunity to bring the operation under the proper control of a robust planning agreement to protect the interests of all of Thanet's residents. The prospect of intensification of night flights, while Manston airport has been unable to exploit its daytime capacity, has hung over the county for far too long."
Malcolm Kirkaldie was a member of the former watchdog Manston Airport Group. He said:
“The former owners of the airport never fully addressed local complaints or issues. Developers who come into Thanet need to be accountable to the local community and put something back.”
kentnews.co.uk 19th Mar 2012
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It was nothing to do with night flights, it was an investment decision (surprise, surprise), Labour feels vindicated and criticises Tories (surprise, surprise).
Manston airport boss Charles Buchanan has insisted it will be "business as usual" at the airport, following the shock announcement of its sale last Thursday.
A statement from the airport said it was a decision that had arisen from operator Infratil "refocusing" its investment profile. Trying to allay fears over more than 100 jobs at the airport, airport chief executive Mr Buchanan said:
"It is business as usual in every respect. The business will carry on as it has done and will continue to do so. We would like to reassure all our customers that flights will not be affected. If you have booked a trip with CI Travel Group or Newmarket Holidays, you have absolutely no need to worry as all flights to Jersey, Croatia, Italy and Portugal will be operating as normal. I would also like to stress that jobs are not under threat and we are very grateful to our staff for their support during this time."
Mr Buchanan denied the proposed sale of the airport had anything to do with the night flights consultation which finished the week before:
"It was a decision made by Infratil shareholders and they decided what was best for them. Their investment strategy was no longer in the best interests of the airport and we are now seeking an investor whose strategy matches the needs of airport."
He added that the night flight policy was still important for the future of the airport and attracting new investors:
"The position, which I have stated all the way though, is that for this airport to be successful it needs to operate from a competitive position."
Leader of Thanet council Clive Hart however said he felt that the proposed sale put question marks over the issue of night flights:
"This bolsters my decision to hold a cheaper, in house consultation on night flights. We will consider the issue as we did before, but on the other side it seems that all is not the same. A new owner might not want night flights."
Mr Hart denied suggestions that Labour's anti night-flight stance in its election manifesto had any bearing on Infratil's decision to sell:
"From my discussions with Charles Buchanan, it seems that the delay and prevarication of the previous Conservative administration had a far more detrimental effect than our stance."
Management consultancy firm PricewaterhouseCoopers has been appointed as advisers to assist in the sale of Manston. Mr Buchanan added:
"We are excited about the opportunity that the sale offers us and are looking forward to working with new investors."
Thanet Times 14th Mar 2012
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