City Hopes For FAA Approval By Year's End
Furthering its reputation for creativity in disposing of its
airports, Chicago's Daley regime (er, administration) reports
reaching a landmark agreement to privatize Midway Airport.
Crain's Business Weekly reports the $2.52 billion winning bid
represents the low end of a range predicted by market observers,
but then, this has also turned out to be a bad couple weeks to get
big deals financed.
"As the first privatization of a major American airport, this
transaction will provide unprecedented benefits for the traveling
public, the airlines and the taxpayers of Chicago," Mayor Richard
M. Daley said.
Robert Poole -- the director for transportation studies at The
Reason Foundation, and a noted proponent of airport privatization
-- commented, "That's actually more than I was expecting under
current circumstances. It's a bet on the long-term future of
The winning bidder is Midway Investment & Development Corp.,
a consortium consisting of YVR Airport Services Limited., Citi
Infrastructure Investors of New York, and John Hancock Life
Insurance Company of Boston.
"This contract marks a milestone in the growth of our company
and is a clear example of how we can leverage our success at home
to develop the best airports in the world," said Larry Berg,
president and CEO for the Vancouver Airport Authority. "Since the
mid-nineties, our subsidiary, YVRAS, has grown from a great idea
into a global airport operator, and we're proud of this homegrown
The 99-year lease still needs approval by the City Council, the
FAA and the Transportation Security Administration. The city hopes
to get FAA approval by year-end.
For Southwest Airlines and Midway’s other carriers, the
deal includes a 25-year agreement that caps landing fees below the
current level for six years and then allows them to grow at the
government's core inflation rate. The city will continue to provide
police and fire protection at the airport.
Too bad Daley couldn't have privatized Meigs Field...