Kasarda | Aerotropolis business magnets (Part 2)

Elsewhere in Asia-Pacific

Airport city and aerotropolis development has been highly active in numerous Asian locations beyond China. Incheon International Airport (ICN), with 71.2 million passengers and 2.5 million tonnes of cargo in 2019, anchors the most comprehensive airport city and aerotropolis in the Asia-Pacific region.

ICN’s two terminals lead the world in duty-free sales (over $2.4 billion in 2019). There is also substantial commercial real estate development on its vast property, including (among others) office building complexes, five-star hotels, integrated gaming resorts, water parks, and major logistics zones. Maglev rail connects key sections of airport property.

Outside ICN’s fence, the 209-square-kilometre Incheon Free Economic Zone is fostering development of the greater aerotropolis. The Zone attracted over $40 billion in investment in modern goods handling and business services sectors between 2010 and 2020.

Arguably, the most impressive cluster is the Songdo IBD (International Business District), a $35 billion smart city being built from scratch on 6.1 square kilometres of reclaimed land.

Approximately 80% complete, progress at the Songdo IBD slowed in the past three years due to a fall out between its two developers – New York’s Gale International and South Korea’s POSCO E&C, the nation’s top steel producer.

Hong Kong International Airport (HKIA) and its outlying areas have likewise fully embraced airport city and aerotropolis development. In addition to extensive terminal retail and leisure services, the airport hosts major hotels and boasts an international conference and exhibition centre in AsiaWorld-Expo, a multi-purpose World Trade Centre, and the world’s busiest air cargo facilities.

Tung Chung New Town lies just 500 metres from the airport boundary, where high-rise residential towers, shopping centres, and cultural venues continue to expand.

Also, the nearby Hong Kong Disneyland Resort welcomed nearly seven million visitors in 2019. Two new themed areas were under construction in 2020 — Arendelle: The World of Frozen and Stark Expo Hong Kong.

The opening of the 55-kilometre Hong Kong–Zhuhai–Macau bridge in October 2018 was pivotal in integrating China’s Pearl River Delta (the ‘Workshop of the World’) with HKIA.

Together with fast-ferry services to Delta coastal cities and an efficient airport express train, this bridge has made HKIA’s airport city the quadrimodal CBD of an extended aerotropolis populated by approximately 40 million.

In Singapore, Singapore Changi’s extensive array of terminal retail venues along with leisure offerings — including exotic gardens, hospitality services, movie theatres and swimming pools — are instrumental in the airport’s frequent rating as the world’s best for passenger amenities.

The opening of Jewel Changi Airport in October 2019 on 3.5 hectares of land next to Terminal 1 topped all airport city developments. Jewel’s distinctive glass-and-steel façade, rising ten stories with 134,000sqm of floor area, represents an amazing leisure destination of gardens, hiking trails, 300 retail and dining outlets, a hotel and a 40-metre-high rain vortex at its centre, among other attractions.

Extending outward from the airport are clusters of logistics and business parks, conference centres, university campuses, and integrated resorts.

In India, the GMR Group, which operates Hyderabad’s Rajiv Gandhi International Airport, is executing a theme-based airport city master plan consisting of six major commercial clusters: aerospace, business services, education, entertainment, health, and logistics.

Each cluster is being developed with unique design features reflecting its land-use functions. Its 1,500 acre airport city includes a multi-product special economic zone consisting of temperature controlled and fast-cycle distribution facilities, MROs, aircraft engine parts manufacturing, and other aviation-oriented businesses.

Stretching 10 to 20km outward from the airport, a greater Hyderabad Aerotropolis is dominated by IT and other high-tech, aviation-oriented sectors. India’s IT giants, Infosys and Wipro, have substantial campuses, as do US-based Microsoft and aerospace firms, such as Sikorsky.

In Malaysia, Kuala Lumpur International Airport (KLIA) aims to become a major platform for commercial development and international trade under the name KLIA Aeropolis.

Aeropolis is expansive, covering 10,000 hectares, of which 3,000 hectares are geared to commercial, industrial, institutional, and leisure uses.

While Aeropolis has achieved several significant commercial goals to date, including having its own Formula 1 racetrack (pictured above) and excellent terminal retail and passenger leisure services along with five-star hotels, its full promise has yet to be attained.

As of 2020, Malaysia Airports Holding Berhad, which operates both the airport and Aeropolis, remained focused on implementing plans for extensive airport city and aerotropolis development.

Elsewhere, in Chinese Taipei, protests over farmland expropriation has slowed the development of the 4,500-hectare Taoyuan Aerotropolis adjacent to Taoyuan International Airport.

Conflicts with farmers and other landowners as well as environmental issues were being addressed in 2020 by Taoyuan County officials and central government bodies in efforts to jump start the national government’s flagship aerotropolis project, originally expected to attract $16 billion in investment.

While in Australia, in 2019 plans were completed for a Western Sydney Aerotropolis around Sydney’s second international airport to be constructed about 55km west of Sydney’s CBD.

The aerotropolis is being backed by huge financial commitments by the central government for connecting rail and highway infrastructure with significant private sector investment already committed by a number of international firms. The target date for airport and aerotropolis operation is 2026.

Finally, considerable investment in airport cities and extended aerotropolises is also proceeding on and outward from U-Tapao Airport on Thailand’s Eastern Economic Corridor and Clark Airport in the Philippines.

While both are former US air bases, Clark envisions itself as Manila’s second international airport and U-Tapao Bangkok’s third, the latter to be connected by high-speed rail to the city’s downtown in under an hour.

San Miguel Corporation, the Philippine beer giant, has proposed to construct a new international airport following the aerotropolis model in Bulacan, 11 kilometres north of Manila, but environmental issues concerning the adjacent estuary as well as protests by local fishermen, who would be impacted, have impeded progress.

The projects described above represent some of the largest, but by no means only airport city and aerotropolis initiatives in Asia and the Pacific.

Many others are moving forward that should solidify this global region’s leadership position in airport-linked commercial and industrial development for decades to come.

In the next issue of Airport World, I will provide updates on key airport city and aerotropolis projects in the Africa, the Americas, Europe and the Middle East.

The article is originally published on Airport World Issue 1, 2020.