Owais Crawford
Airports are often owned by government entities and are considered essential infrastructure under state control. In the United States, state or local governments own most public-use airports, while some public-use general aviation airports are privately owned. For example, the Dallas-Fort Worth Regional Airport is jointly owned by the cities it serves, while the John F. Kennedy International Airport is owned by the City of New York but leased to the Port Authority of New York and New Jersey for operations. Outside of the US, airport ownership varies, with some countries like Brazil and the United Arab Emirates having a mix of public and private ownership.
| Characteristics | Values |
|---|---|
| Ownership models | Vary from full public (national or local government) ownership to full private ownership |
| Public-private partnerships | Private sector efficiency and capital leveraged |
| Public-private partnerships examples | Dubai International Airport, London Heathrow Airport, Frankfurt Airport, Changi Airport |
| Private ownership examples | São Paulo-Guarulhos International Airport, London Heathrow Airport, London Gatwick Airport, Rome Leonardo da Vinci-Fiumicino Airport, Zurich Airport, Copenhagen Airport, Lisbon Airport |
| Public ownership examples | Atlanta International Airport, Dubai International Airport, Changi Airport |
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What You'll Learn
Airports can be owned by the city they are in
Airports are complex parts of a nation's infrastructure, and there is no one-size-fits-all ownership model. They can be owned by the city they are in, or by a mix of public and private entities. For example, Atlanta International Airport, the busiest airport in the world by passenger traffic, is owned by the City of Atlanta in the State of Georgia. The airport is managed by an Airport General Manager appointed by the Atlanta City Council, and its major initiatives are approved by the city government and the mayor's office.
On the other hand, some airports are owned and operated by private companies. For instance, London Heathrow Airport, one of the busiest airports in the world, is owned by Heathrow Airport Holdings. Similarly, the major Australian airports were privatized in the 1990s and are now owned by private companies.
Many airports also operate as public-private partnerships (PPPs), where the airport ownership is retained by the government, but operations are handled by a private company. One example is Dubai International Airport, where the government maintains control while a private entity operates the airport. Another example is Frankfurt Airport, which is owned by Fraport AG, a publicly listed company with mixed ownership by the German State of Hesse, a private company, and Lufthansa.
PPPs allow local governments to transfer financial risk to private partners while incorporating private sector innovations and investments without fully privatizing public infrastructure. One common concession agreement is the Build, Operate, Transfer (BOT) model, where a private sector company enters an agreement with the government to plan, finance, develop, and operate an airport for a set period.
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Some airports are owned by private companies
Airport ownership varies across the world, ranging from full public ownership to full private ownership. While many airports are owned by national or local governments, some airports are indeed owned by private companies.
London Heathrow Airport, for example, is owned by Heathrow Airport Holdings, a private company. Similarly, London Gatwick Airport is majority-owned by GIP, and Rome Leonardo da Vinci-Fiumicino Airport is owned by Aeroporti di Roma. Zürich Airport is owned by Flughafen Zürich AG, Copenhagen Airport by Københavns Lufthavne, and Lisbon Airport by Vinci SA. The major Australian airports were privatized in the 1990s, with Melbourne, Brisbane, and Perth Airports being sold off.
Some airports have mixed ownership, with shares held by both the government and private companies. Frankfurt Airport, for instance, is owned by Fraport AG, a publicly listed company in which the German State of Hesse owns over 30% of shares, while a private company, Stadtwerke Frankfurt am Main Holding GmbH, owns over 20%.
In some cases, airports are corporatized, with an independent entity responsible for planning and operations. Changi Airport in Singapore is a successful example of corporatization, where the airport company has freedom and flexibility in its management while maintaining public sector ownership.
Public-private partnerships (PPPs) are also common, where private entities assume certain responsibilities for public assets through long-term contracts. PPPs allow local governments to transfer financial risks to private partners while incorporating private sector innovations and investments. PPP concession agreements enable private sector companies to plan, finance, develop, and operate airports for a set period.
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Airports can be owned by multiple cities
Airport ownership varies across the world, with no single ownership model applied universally. While some airports are fully owned by the public sector, others are completely in private hands. Many airports fall somewhere in between, with mixed ownership involving both the government and private companies.
In the United States, airports often lease part or all of their facilities to outside firms, which then operate functions such as retail management and parking. Public-private partnerships (P3s) are common, where private entities assume certain responsibilities for public assets without fully privatising them. P3s allow local governments to transfer financial risk to private partners while incorporating their innovations and investments.
In Europe, most government-owned airports have been transformed into companies that own and operate the airport, with the government as the initial owner. Since privatisation, some governments have sold their shares, resulting in completely privately-owned airports. Examples include London Heathrow Airport, owned by Heathrow Airport Holdings, and London Gatwick Airport, with majority ownership by GIP.
In some cases, airports are owned by specific cities, such as Hartsfield Jackson International Airport in Atlanta, owned by the City of Atlanta in the State of Georgia. The airport's chief, the Airport General Manager, is appointed by the Atlanta City Council and is a government employee. The airport's major initiatives are approved by the city government, and its annual reports are published by the City of Atlanta, featuring a message from the Mayor.
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Airports can be financed by bonds
Airport ownership varies across the world. Some airports are fully owned by the public sector, some are fully owned by the private sector, and some have mixed ownership. For example, Atlanta International Airport is owned by the City of Atlanta in the State of Georgia, while London Heathrow Airport is one of the busiest airports in the world and is privately owned. Frankfurt Airport is another major international airport with mixed ownership, with the German State of Hesse owning over 30% of its shares, a private company owning over 20%, and the government holding a minority share.
Revenue bond financing is well-suited for large capital investments, such as implementing new systems or replacing major facilities. For example, Robert Poole, the director of transportation policy for the Reason Foundation, has advocated for bond financing, user fees, and treating ATC like a utility to keep airport technology up to date. Similarly, Sean Duffy, the U.S. Department of Transportation Secretary, unveiled a plan to reconstruct the nation's air traffic control system due to aging infrastructure at Newark Liberty International Airport.
Examples of airports that have been financed by bonds include San Diego International Airport, which issued an offering of $1.13 billion to finance an overhaul that includes adding 11 gates to a new Terminal 1 and other amenities. Additionally, the Montana Facility Finance Authority has the ability to issue debt for a range of organizations, and user fee-supported bonds have been proposed to address funding levels at Newark Airport.
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Airports can be publicly owned but leased to private companies
Airports are complex parts of a nation's infrastructure, and there is no one-size-fits-all ownership model. While some airports are fully owned and operated by the public sector, others are completely privately owned. However, many airports fall somewhere in the middle of this spectrum, with various public-private partnership (PPP) arrangements in place.
One example of a PPP is a concession, where the airport remains publicly owned, but operations are handled by a private-sector company. This allows local governments to transfer financial risk to private partners while benefiting from private-sector innovations and investments. PPPs can be used to build and operate entire airports, redevelop terminals, or manage specific functions like retail or parking.
In the United States, for instance, many airports lease part or all of their facilities to outside firms, which then operate functions such as retail management and parking. A study estimated that leasing 31 medium to large airports in the US could generate $1.3 billion in income within 50 years, funding infrastructure projects.
Another example of a PPP is a management contract, where ownership remains public, but contractors are appointed to perform specific functions or operate the entire airport. For instance, the German operator Fraport was awarded a six-year management contract for two airports in Saudi Arabia in 2008. Fraport itself is an interesting case: it operates Frankfurt Airport and 30 others worldwide, and its ownership is mixed, with the German state of Hesse owning over 30% of its shares, over 20% owned by a private company, and Lufthansa holding 8% after being privatized in 1997.
Corporatization is another model, where an independent entity is created to manage and operate an airport with more freedom and flexibility. Changi Airport in Singapore is a successful example of corporatization, maintaining public ownership while adopting a commercial approach.
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Frequently asked questions
Airports can be owned by either the public sector or private companies. In the United States, state or local governments own most public-use airports, while some public-use general aviation airports are privately owned. Globally, a substantial number of airports are owned and operated by government entities.
In the United States, Hartsfield-Jackson Atlanta International Airport and Los Angeles International Airport are owned by local governments. The Dallas-Fort Worth Regional Airport is jointly owned by the cities that the airport serves. The Port Authority of New York and New Jersey (PANYNJ) oversees the operation of JFK and LaGuardia Airports, which are owned by the City of New York but leased to the Authority.
In Brazil, major airports such as São Paulo-Guarulhos International Airport, have been privatized. In the United Arab Emirates, Dubai International and Al Maktoum Dubai World Central Airports are owned by a private company called "Dubai Airports Company".
