Brisbane Airport's potential in plane view
Jan. 16, 2006
When Koen Rooijmans came to run the newly privatised Brisbane Airport in 1997, he saw one advantage the airport had over other Australian airports -- land.
In the nine years since, Rooijmans, the chief executive of the Brisbane Airport Corporation, has added on a variety of specialist precincts at the airport to the extent that its core business of accommodating aircraft to take off and land now only accounts for 40 per cent of its revenue, while for most other airports it is higher than half.
Late last week, Rooijmans launched the latest in a series of add-ons at the airport, the Da Vinci Centre, the only aviation training and education centre on an airport in Australia, which will be based around the site of what had been the old international terminal.
The training precinct joins three other specialist areas -- a fast-developing retail precinct known as One Airport Drive based around a Direct Factory Outlet; Export Park, an industrial estate featuring companies such as Cellnet which assembles mobile phones flown in from Asia and then distributes them within Australia; and Aerotech Park, a maintenance precinct where Qantas and Virgin Blue have facilities.
What the BAC has done is take what was vacant grass around the main runway and put these precincts on them. As they grow -- especially the retail precinct -- Rooijmans estimates there will be 25,000 people working at the airport in 2020. There are 8000 there now.
"All of these projects support each other -- people who will be trained at the Da Vinci Centre will go and work at Aerotech Park or Export Park, and One Airport Drive will help us create the airport as a whole precinct within the city," he said.
What Rooijmans is referring to here is what is now a retail centre but will be expanded to have a golf course and an international hotel as well. "They have international hotels in Sydney so that people can stay somewhere between flights or if they have a late night or early morning flight, and we aim to have the same here," he said.
"But we have always had a long-term plan for the airport and slowly we're putting all the pieces of the jigsaw together."
Brisbane Airport was privatised by the Howard Government in 1996 along with those of Perth and Melbourne in the first tranche of airport privatisations.
While some big infrastructure players all bidded for the airport, the eventual winner, which paid $1.37 billion for Brisbane Airport, was a syndicate put together by the Brisbane City Council and based on the Schipol Corporation which operates the Amsterdam Airport in the Netherlands and an airport in New York.
But while Brisbane Airport has been "privatised", more than half the airport is still owned by various public-sector entities.
Schipol still owns 16 per cent of BAC and, oddly enough, is still fully owned by the Dutch Government, which has corporatised the airport, although it is due to be privatised later this year.
The Port of Brisbane Corporation, which is wholly owned by the Queensland Government, has 37 per cent of the BAC, while the Brisbane City Council -- which, ironically, was a vigorous opponent of privatisation back in 1996 but still ended up owning 10 per cent of the newly privatised corporation back then -- still has around 1 per cent.
The remaining 46 per cent is owned by various superannuation funds, although there is no one single large shareholder.
But the Dutch connection has always been important to the development of Brisbane Airport. Rooijmans did not work directly for Schipol when in Holland but had a background in airlines, including a stint as a regional manager for Dutch carrier KLM.
"The head of Amsterdam Airport said to me -- go out and buy me an airport," said Rooijmans. "We looked around the world and in Australia you were just starting to sell off the airports, but this is the one we wanted.
"When we came to Australia we saw a greenfield site where the property had a lot of potential.
"But the big difference is the culture. We saw a lot of opportunity and a lot that could be done, but we went forward very strongly." An example of this is the role BAC played in wooing Virgin Blue to set up its base in Queensland in 2000, when it offered considerably lower start-up charges for airport terminal space to Virgin in comparison with its main competitor, Melbourne's Tullamarine Airport.
In 1999, the BAC was also the main co-ordinator of the formation of Australia's Trade Coast, which markets the airport, the nearby Port of Brisbane and an industrial estate owned by the state Government.
While the BAC has joined other organisations from time to time in marketing, its main focus has been on its own land.
When Rooijmans and three other Schipol executives arrived in Australia in early 1997, the first aspect of their new purchase they noted was that it had 2700ha of land and was three times the size of Sydney Airport.
Since then, about $350 million has been invested in on-airport property development with a further $500 million for investment over the next five years.
But the corporation has hit some obstacles in its bid to expand. The biggest of these was a strong legal challenge from shopping centre giant Westfield, which owns Toombul Shoppingtown, less than two kilometres from where the BAC has established its retail precinct. This challenge was dismissed last year.
But Rooijmans was quick to stress that while the airport corporation was working to use all its land, it also was not neglecting its core business of aircraft movements.
He said that since Brisbane Airport was privatised, the number of people passing through the airport each year had risen from 10 million to 16 million.
Brisbane was closing on Melbourne, which had a throughput of 20 million, although both are well short of Sydney's throughput of 28 million.
"Macquarie (Bank) paid $6.5 billion for Sydney and we paid $1.4 billion for Brisbane," Rooijmans said. "Who got the better deal?"