Punta Gorda Airport (PGD) is proving that one size does not fit all when it comes to air service development.
In 2014, passenger volume at the southwestern Florida airport jumped a colossal 88% over the previous year. By mid-Spring 2016, PGD expects to finish an $8.6 million terminal renovation and expansion.
Executive Director Gary Quill explains that the airport is investing in its facilities as Allegiant Air grows its service there. The strategy has been to meet increased customer demand with incremental improvements and additions that stress function over fashion. Throughout the years, Quill and other airport officials have experienced an interesting journey evolving the terminal to its current state.
Project: Terminal Expansion & Renovation
Location: Punta Gorda (FL) Airport
Owner/Operator: Charlotte County Airport Authority
Cost: $8.6 million
Funding: 70% FAA; 30% state grant & airport
Terminal Addition: 40,000 sq. ft.
Space Renovated: 16,000 sq. ft.
Program Manager: AECOM
Architect: Schenkel Shultz Architecture
General Contractor: DeAngeles Diamond Construction
Baggage Handling System: G&S Airport Conveyor
Traffic Modeling/Forecasting: Airport Cooperative Research Program
Concessions: Faber Int'l
In 2007, Skybus Airlines brought the first commercial air service to PGD since 1984, and the airport served its passengers out of a basic 16,000-square-foot terminal with two gates. When Skybus went out of business in 2009, many community members were not surprised. James Parish, assistant executive director at the county-owned and -operated airport, recalls the sentiment as: "See, we told you it wouldn't work."
Undeterred, Parish says that Skybus helped "prove the model," and the airport did, in fact, attract service from Direct Air, Vision Airlines and Allegiant Airlines. While Allegiant is the only carrier still operating at PGD, its service has grown from three to 28 cities. Previously, the carrier didn't base any aircraft at PGD; now it bases six there during peak season in fall and winter.
Parish notes that fully 99% of the airport's enplanements are leisure, with 70% being inbound traffic. "Allegiant's thing is they're so cheap, you can't afford not to fly," he explains. "They're basically taking people off the couch who wouldn't usually take the trip."
Officials expect the airport to finish this year with 30% more passenger volume than in 2014. While such growth is noteworthy, Parish and Quill agree that the rate is not sustainable over the long run. They still expect growth in 2016 and beyond, just not as much. "I could see next year at maybe 20%, and then maybe leveling off at 5% or 10% the next few years," Parish says. "Allegiant has been very aggressive about growing this base. We're one of the most profitable bases for them."
Allegiant's profitability has a lot to do with PGD's business model, he adds.
When Skybus began serving the airport, PGD did not have any debt; so it developed an arrangement that allowed the airline to essentially fly in and out for free. "We made our money off of parking and rental cars," Parish explains. At the time, there was skepticism about whether the model would work; so it was limited to three years. But the approach proved successful by the end of the trial. "The numbers were better than we ever imagined," Parish recalls.
Since then, the airport has stuck with its winning model and maintains a $0 cost per enplanement for Allegiant. The airline pays a fuel hookup fee, but provides its own fuel and handles its own maintenance, ground handling, etc.
PGD began as an intermediate stop for Allegiant flights that originated in St. Petersburg, FL, and served three cities. The carrier didn't begin basing aircraft in Punta Gorda until March 2012, after Direct Air went out of business. "That was the beginning," Parish reflects. Currently, Allegiant is in the process of switching the aircraft it bases there from MD-80s to A320s.
Currently, about 90% of PGD's 70,000 operations are general aviation flights.
Quill reports that revenue from customer parking during 2015 should hit $1.4 million, and rental car revenue is expected to exceed $3 million. Together, the two concessions average about $10 per enplanement, he notes.
In total, PGD nets well more than $1 million from its sole airline - enough to subsidize other operations. "It's kept our general aviation costs so low that we have not increased our T-hangar rent in 10 years," he remarks.
With total enplanements for 2015 expected to hit 400,000, Quill notes that the airport was able to accommodate significant growth without the weight of 30-year bonds, which many airports use to support terminal projects. "We've been able to incrementally add so that we don't have that humungous debt hanging over us," he elaborates. "In effect, it creates a much more cost-effective situation."
Step by Step
To meet the customer demand associated with a "rapid run-up" of Allegiant service over the last few years, PGD set up a temporary holdroom on the ramp. The facility seated about 300 people and was created by joining seven 58-foot trailers together. "That began the planning for an expanded terminal," Parish recounts.
Two separate studies were performed with the FAA to quantify the airport's need for more terminal space, and it was still a challenge to get the agency on board, he remarks. "The FAA model for small hub or non-hub airports was written in the early '80s and it doesn't really fit an origination/destination type airport," he explains. "It fits an airport that's part of a hub and spoke (system)."
Because PGD's six based aircraft all depart in the morning within 20 minutes of each other, the airport has high peaks of passenger volume in the morning and again in the afternoon when aircraft return.
"We have been growing so fast that it's really hard for the FAA or any government entity to keep up with it," Parish acknowledges. Under the FAA model, the terminal area forecast indicated no growth for PGD. Even with data that demonstrated the actual growth, the FAA model still showed zero, he explains.
PGD subsequently used modeling from the Airport Cooperative Research Program and other sources to demonstrate its need, and FAA later approved its plan. AECOM was contracted to manage the $8.6 million project program, and Schenkel Shultz was selected to provide architectural services for the design-bid-build project.
The project includes a 43,000-square-foot expansion as well as renovation of the existing 16,000-square-foot Bailey Terminal. When work is complete, PGD will have six gates. Ticketing, TSA screening and bag screening will be located in the renovated building with two gates and holdrooms. The four new gates and holdrooms are slated for the new portion, which will be served by two bag belts.
The FAA is funding 70% of the project; the remaining expenses are being covered by the airport and a grant from the Florida Department of Transportation.
Pretty Is As Pretty Does
When the airport opened its former terminal in 2007, officials told architects they weren't interested in winning any design awards. "We wanted it to be functional and inexpensive, and that's what we built," explains Parish.
That facility is now four times its original size, but the airport has continued to focus on low expenses and a lean staff. "We really work to keep our costs down and help the airlines keep their costs down," Parish comments.
The airport is maintaining the same emphasis on function during its current expansion program. "You have to have an architect that understands this isn't to be a monument to anyone," says Steven Henriquez, vice president with AECOM. "You can do something relatively inexpensive and efficient."
PGD's new building is rectangular shaped - which is efficient to build - and constructed with cast concrete panels - a very inexpensive method to build large buildings, he explains. "We're not going high end; we're going commercial quality with long-lasting, low-maintenance materials that have a good shelf life," Henriquez continues. "We're doing a lot for a little."
The new terminal's plain structure does not mean it lacks service or comfort, Parish emphasizes: "It's a very nice, very functional, spacious building; but we have an eye on the cost every step of the way."
He cites terrazzo flooring and other finishes selected for easy maintenance as examples of cost-containing measures.
Parish notes that even though the design is basic, the facility flows in a typical manner and is appropriate for PGD's needs. "We were a small airport, and we're still a small airport," he reasons. "But I think today it looks more like what (passengers) are used to."
A newsstand/gift shop and new restaurant with full bar are slated to open by January, under the direction of Faber International, PGD's new concessionaire. The airport is also in the development phase of implementing a new advertising program with a national firm.
Officials note that the facility is designed to meet current rather than future needs, because FAA's model requires airports to base projects on previous years' numbers. Even so, they built in flexibility by including extra seating where possible. "Allegiant is still talking about adding more aircraft and more cities," Parish notes. "And, as most airports, we're constantly evolving."
Like other airports throughout the industry, PGD is experiencing some discomfort during its construction. For roughly nine months, the airport had only one lane available in front of the terminal for drop offs, which caused some traffic headaches. Airside, at least one-third of the ramp was fenced off to keep construction outside the airport operations area and preclude the need for extra security measures.
Completing as much of the project as possible during off-peak travel seasons has been a challenge, Henriquez acknowledges. "The intent was not to be in construction during two traffic seasons," he details. "We're trying to keep the impact as little as possible."
Work on the new addition began in March and was finished in August - providing Allegiant with four new gates before its peak season at PGD. The second phase of the program, rehabilitating the existing terminal, is slated for completion by March 2016.
Growth has inspired some local pushback. "There are people that don't like our model - the airline not paying," Parish advises. "But for the most part, it has been a great thing for the area." He and Quill consequently both make time to speak with community organizations to help garner support for the airport and its terminal project. "We did get a lot of support from the business community, the hoteliers, real estate agents and restaurants that really support what we're doing," he reports.
And what they're doing adds 200 jobs that wouldn't otherwise exist, Quill notes. The most recent economic impact study about PGD was conducted by the Florida Department of Transportation in 2014, based on 2012 data. At that time, the airport was credited with $219 million of annual impact in the region. Its current impact, however, is logically much greater, because the study was largely based on enplanement figures, and passenger traffic has more than tripled since 2012.
The county's real estate market has also benefited from the airport, Parish adds. "A lot of that is attributed to people being able to get down here inexpensively," he explains. "They can hop on a plane and be here without going through Atlanta or another hub."
Low Costs Fuel Improvements
Parish says PGD's model works because the airport keeps its costs extremely low by operating with a small workforce and expanding in a cost-conscious manner.
"They do wonders with the few people they have on staff," observes Henriquez.
Keeping a tight budget allows PGD to be competitive with its neighbors - Sarasota-Bradenton International to the north and Southwest Florida International in Fort Meyers just 20 miles south.
"We went with the Wal-Mart model," quips Parish, about PGD's new terminal. "It's a very inexpensive, but functional building that can get people in and out."
The terminal's grade-level design and ground-boarding-only approach are critical to containing costs. Second floors come with additional expenses - particularly elevators and/or escalators and boarding bridges.
Another way PGD holds the line on expenses is hiring off-duty police officers for security instead of maintaining a force of its own. It also builds parking lots rather than more expensive covered garages.
Designs for a multi-phase parking expansion are nearly complete, and the airport recently improved its rental car facilities. The first phase of planned parking improvements will add 200 to 400 spaces, a new 50-car cellphone lot, employee parking and overflow parking for customers. The ultimate size of the parking lot will depend on the bids PGD receives, Parish notes. "Basically, cost is one of the biggest driving factors in our decision-making," he explains.
To keep pace with increased airline activity, an air traffic control tower was added in 2013. "We were operating with a lot of traffic without one," Parish comments. "And it was hard to get the FAA to approve our tower, even though we had the funding to build it from the state."
Other airfield improvements include a taxiway expansion and the addition of an instrument landing system.
In addition, the airport recently added a second fire truck to its fleet. Parish notes that the new equipment is a tremendous benefit to the general aviation side of the airport, since 80% of aircraft rescue and firefighting calls are for general aviation incidents. The airport is also modifying the general aviation parking areas and plans to build a new general aviation terminal in 2016. "We're still a general aviation airport that has commercial service," Parish advises.
That said, Quill notes that if other airlines are interested in operating at PGD, the airport has facilities for them. "So far, Allegiant is the only one on the horizon," he relates.
"We get nibbles, but haven't had any bites," Parish adds. "I think we've definitely proven that there's a desire to come to this area."