APAC: Seventh Japanese airport privatization awarded

22 May 2018 - 12:00 am UTC

Wakayama Prefecture will this month sign an initial agreement to privatize Nanki-Shirahama airport in western Japan, a prefecture official said on Tuesday (22 May).

On 15 May the prefecture selected a consortium led by Tokyo-based consulting firm Industrial Growth Platform Inc (IGPI) as the preferred bidder to run the airport over the 10-year concession period (extendable by 10 years).

Last week also saw an eighth airport, Fukuoka Airport, select a preferred bidder.

The IGPI-led group has offered to reduce the prefecture’s airport operating expenses over the ten-year period to JPY 2.45bn (USD 22m) from the expected JPY 3.1bn.

The IGPI-led group has also proposed to nearly double the number of passengers from 132,151 to 250,000 within 10 years, by enlarging aircraft sizes and introducing new flight services.

The regional airport has seen disappointing passenger numbers, despite its location close to tourist attractions such as the World Heritage Kumamoto Kodo pilgrimage routes. While numbers rose 10% to 132,151 in the business year ended March, this was well below the 150,000 target set by the local authorities.

Other members in the consortium are IGPI’s unit Michinori Holdings and locally-based hotel operator Shirahamakan.

With a 2,000m runway, the airport currently operates three return flights per week to Tokyo’s Haneda International Airport.

The other shortlisted bidders – Tokyo-based hotel operator Hotel Management International and five local firms – did not submit final offers by the 1 May deadline, local officials said.

 

Wakayama Prefecture