Qantas and Brisbane Airport Reach Commercial Agreement
27 February 2014
Qantas and Brisbane Airport Corporation (BAC) have today reached a commercial agreement covering terminal and runway access at Brisbane Airport, which includes arrangements for the airline to dispose of its long-term lease on its terminal.
Qantas holds a 31 year lease, signed in 1987, on the northern end of the Domestic Terminal at Brisbane Airport which is due to expire on 30 December 2018.
Under the new arrangements, Qantas would retain exclusive use and operational control over much of the northern end of the terminal until the end of 2018 while securing rights to key infrastructure beyond this period.
In addition, BAC plans to make a significant investment in upgrading and improving facilities and services within the terminal, such as lounges and will assume control of the retail space of this part of the terminal.
Qantas will receive total cash proceeds of $112 million from BAC under the arrangements.
The arrangement also covers Qantas’ use of the runway system at Brisbane Airport, including current infrastructure and the new parallel runway, currently under construction.
Qantas Group Chief Executive Officer Alan Joyce said the agreement was a win-win for both parties which would have significant benefits to Queensland.
“Brisbane Airport is one of the most important airports for Qantas today and increasingly so into the future. This investment is vital to the ongoing growth of aviation in Queensland which helps drive tourism and boost the economy,” Mr Joyce said.
“Qantas will continue to offer the most flights of any airline from Brisbane to the most destinations, with the best product and service in the air and on the ground.
“The deal is in line with our strategy of unlocking value in non-core assets.“Qantas customers will continue to enjoy the faster smarter check in facilities, lounges and gate access with further improvements to be made in the near future.”
Mr Joyce said the agreement reached with Brisbane Airport on the new parallel runway was consistent with the Qantas Group’s position of not pre-funding airport infrastructure before actually using it.
BAC’s CEO and Managing Director Julieanne Alroe said the agreement was an important step in the future of Brisbane Airport.
“This agreement is the welcome completion of BAC’s negotiations with our airline customers over the development of the new parallel runway,” she said.
“It will also allow us to invest, over time, in better facilities and services at the northern end of the Domestic Terminal. BAC has a forward investment plan of more than $2.5 billion in improvements at Brisbane over the next decade.”