Privately Owned Major Airports: Do They Exist?

The ownership of airports varies across the world. While some airports are owned by governments, others are privately owned or operated as public-private partnerships. In the United States, for example, major airports like Hartsfield-Jackson Atlanta International Airport and Los Angeles International Airport are owned by local authorities. On the other hand, London Heathrow Airport in the United Kingdom is privately owned, while some airports in the United Arab Emirates exhibit a mix of private and public ownership. Fully private ownership of airports is rare in the US, but public-private partnerships are common, allowing local governments to transfer financial risk while attracting private investment.

London Heathrow Airport is privately owned

London Heathrow Airport is one of the busiest airports in the world by passenger traffic. It has a huge infrastructure spanning over an area of 3,000 acres with 2 runways, 133 boarding gates, and 5 terminals. The airport serves 203 destinations in 84 countries.

London Heathrow Airport was formerly owned by the British Government under the British Aviation Authority. However, it was later privatized and is now owned and operated by Heathrow Airport Holdings (formerly BAA plc) since 1987. Heathrow Airport Holdings is a private company dealing in airport operations and is based in London, England. The company was formed by the privatisation of the British Airports Authority, as part of Margaret Thatcher's privatisation of government-owned assets.

Heathrow Airport Holdings makes money by charging landing fees and departing passenger levies to airlines and from ancillary operations within the airport such as retail, car parking, and property. The company's head office is located in the Compass Centre, on the grounds of Heathrow Airport in the London Borough of Hillingdon.

US airports are rarely fully privately owned

While fully private ownership of airports is common in some countries, it is rare in the United States. The FAA's Airport Investment Partnership Program permits the sale or lease of public airports to private entities, but very few airports have participated. One notable exception is the city of Avon Park, Florida, which recently applied to lease its local airport to a private operator.

Public-private partnerships (P3s) are far more common in the US. These are long-term contracts where a private entity assumes certain responsibilities for a public asset, such as building, financing, operating, and maintaining it. P3s allow local governments to transfer financial risk while incorporating private sector innovations and investment, all without fully privatising public infrastructure.

P3s are responsible for a substantial number of airport projects today, both large and small. Some are established to build and operate entire airports, while others are large-scale, complex projects to replace and redevelop entire terminals. They also include smaller projects at airports of all sizes, such as water supply and parking.

While some completed P3 projects demonstrate the potential benefits of private investments and management in airport infrastructure development, others highlight the importance of careful planning, budgeting, and risk management. As local governments gain greater resources for infrastructure projects, P3s may be overlooked as a model for new projects. However, airports should still consider P3s as a valuable option for low-risk, cost-efficient, high-quality projects. By leveraging private specialised expertise, innovation, and financial resources, passengers may also experience enhanced facilities and more streamlined services.

Public-private partnerships are common in the US

Public-private partnerships (P3s) are long-term contracts in which a private entity assumes certain responsibilities for a public asset, such as building, financing, operating, and maintaining it. While fully private ownership of airports is rare in the United States, public-private partnerships are far more common.

P3s allow local governments to transfer the financial risk involved with transportation projects to private partners while also incorporating private sector innovations and investment, all without fully privatizing public infrastructure. Airports benefit from private sector efficiency and capital, while the government retains ownership and ensures that airports serve broader public interests and adhere to national aviation regulations.

For example, the Port Authority of New York and New Jersey (PANYNJ) was established in 1921 as a joint venture between New York and New Jersey. It oversees the operation of various airports, seaports, bridges, rail transit, and real estate. While the City of New York owns JFK and LaGuardia Airports, they are leased to the Port Authority for operating purposes.

Another example is Heathrow Airport in the United Kingdom, which is privately owned but subject to government regulation to safeguard public interests. This collaboration allows for strategic investment, efficient management, and continuous improvements in passenger experience.

P3s are responsible for a substantial number of airport projects today, both large and small. Some P3s are established to build and operate entire airports, while others are large-scale, complex projects to replace and redevelop entire terminals. They also include smaller projects at airports of all sizes, such as water supply and parking.

As demand for air travel continues to rise, P3s can help local governments finance airport developments and prepare for the future of air travel. By leveraging private sector expertise, innovation, and financial resources, passengers may experience enhanced facilities and more streamlined services.

Dubai Airports Company owns two airports in the UAE

The Dubai Airports Company is a government-owned airports authority that owns and operates two airports in the United Arab Emirates: Dubai International Airport and Al Maktoum International Airport. Dubai International Airport is the primary international airport serving Dubai and is the busiest airport in the Middle East by international passenger traffic as of 2023. It is also the second busiest airport in the world by passenger traffic, handling 87 million passengers and 1.81 million tonnes of cargo in 2023. The airport has three terminals and three concourses, with a total capacity of 90 million passengers annually.

Al Maktoum International Airport, also known as Dubai World Central, is a newer airport that opened to passengers in 2013 and is still under development. The target is to make it one of the world's largest airports, with a capacity of 160 million passengers per year. In 2024, Dubai Airports began working on expanding Al Maktoum International Airport, aiming to secure adequate technical solutions to drive the exponential growth of Dubai's airports.

The Dubai Airports Company is divided into several business units, including Cargo, Finance, HR, Marketing, IT, Engineering, and Commercial. Aviation and logistics are crucial to Dubai's economy, with Emirates Airlines and Dubai Airports Company contributing 26% of the country's GDP in 2011. Dubai's "open skies" policy allows any airline to open service there.

Mixed ownership is common

Mixed ownership of airports is common. In Europe, many government-owned airports have been transformed into companies that own and operate the airport, with the government as the initial owner. Subsequently, some governments have sold their shares, resulting in completely privately owned airports.

For example, London Heathrow Airport is owned by Heathrow Airport Holdings, a private company. However, the UK government plays a regulatory role to safeguard public interests. This is an example of a public-private partnership (PPP), where private companies collaborate with government entities to finance, design, build, and operate airports. PPPs combine the strengths of both sectors, fostering innovation, cost-effectiveness, and timely project delivery.

Another example of mixed ownership is Frankfurt International Airport in Germany. The airport is owned by Fraport AG, a publicly listed company with mixed ownership. The German State of Hesse owns over 30% of its shares, while over 20% are owned by a private company, Stadtwerke Frankfurt am Main Holding GmbH.

Similarly, Charles de Gaulle Airport in Paris, France, is owned and operated by Groupe ADP, a listed company with majority shares owned by the French government. However, there are also private shareholders, resulting in mixed ownership.

Tokyo Haneda International Airport in Japan is another example of mixed ownership. While the airport is owned by the Ministry of Land, Infrastructure, Transport, and Tourism, airport operations are run by three organizations, including Japan Airport Terminal Co. Ltd. and Tokyo International Air Terminal Corporation, which have mixed ownership of the government and private sector.

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