George Hulbert 3 June, 2020
Continuing our series of sit-downs with some of the most influential leaders in corporate real estate and valued sponsors of CoreNet, we caught up with Auckland International Airport’s General Manager of Property, Mark Thomson.
Mark joined Auckland Airport in 2014 and leads the company’s property team. With more than 20 years of experience in real estate management and development, and a wealth of experience in the transport and logistics sectors, he’s responsible for continuing to transform the airport into a vibrant business destination, developing new commercial business premises and attracting high-profile companies. Mark also oversees the company’s hotel business, and he is Auckland Airport’s representative on the Board of Queenstown Airport Corporation.
Anyone who’s been to Auckland Airport over the last couple of years will know that you’ve been leading a lot of change. What can you share with CoreNet members about the journey you’re on?
Auckland Airport has experienced unprecedented growth over the last 3 years. Passenger numbers have increased from 15 million to 19 million, the number of international airlines calling on Auckland has increased to 30, and the number of international destinations we connect to have also increased to 46. It is a very exciting time for Auckland Airport, and for the wider tourism and trade industry.
It has also been an exciting time for our investment property business. We have experienced a stepchange in development activity which has seen us complete some 20 new developments in the past three years alone, ranging from new warehouse buildings, manufacturing facilities, retail units, hotel extensions, office buildings, plus significant investments in infrastructure that has now positioned the company as one of the largest owners of development-ready land in Auckland.
This is all part of a journey which I believe is positioning Auckland Airport not only as New Zealand’s principal passenger and cargo gateway, but also Auckland’s new southern city.
Essentially, the airport is already a small city in its own right and our goal is to differentiate the airport precinct by delivering a high quality environment that is characterised by the highest standards of architecture and urban design, outstanding transport connectivity, and quality amenity for our customers.
While our focus will always be prioritised on the aeronautical and freight sectors, we also see the airport as being a location that is evolving to be a much broader catchment for business users and we have significant capacity to accommodate this.
How are you progressing with those growth plans? What are the main property activities at the airport at the moment?
We are experiencing growth in all sectors of our property business, but the standout area has been in the logistics and light industrial sector. We’re now embarking on stage four of The Landing, which is a 140 hectare, comprehensively planned logistics and industrial park.
This is a large scale development where we now have capacity to tailor facilities to the demands of most companies – ranging from small units to large format distribution facilities. In the last three years alone we have completed developments for Fonterra, DHL, Hellman Logistics, Fuji Xerox, Coca-Cola Amatil, Röhlig Logistics, and we will shortly complete construction of the new Auckland headquarters for the Ministry for Primary Industries.
We also have in excess of 30,000 square metres of new buildings under construction and we expect to be announcing new projects over coming months.
We’re also developing new office and retail buildings which are concentrated in our town centre, which is called The Quad. This is a low-rise, pedestrian-focused office precinct that is serviced by a supermarket, specialty shops, hotels, bars, cafés and restaurants, as well as a conference and events centre.
Moreover, we will shortly be starting construction on a pedestrian bridge that will connect this precinct with the passenger terminals. This will be a landmark structure and a real ‘arrival statement’ which will connect the airport precincts via a pedestrian boulevard - enabling people to move around the airport safely and easily, and enjoy the range of amenity on offer here.
Hotels are also a big focus for us. We currently own and operate two hotels and we are about to start construction on a third hotel that will be located next to the existing Novotel. This project is being undertaken through a joint venture between Auckland Airport and Tainui Group Holdings and will comprise a 300-room, five-star Pullman Hotel.
It will be a premium hotel product that will feature a bar and restaurant on the top floor, designed to give guests unimpeded views of the Manukau Harbour, and across Auckland.
Pullman & Novotel
What is your property vision for the airport?
Our vision is to create an outstanding portfolio of real estate products that represent the best of New Zealand and the World. That means delivering the highest standards of design innovation and functionality for our customers, while embracing those things that make New Zealand special.
Auckland Airport is fortunate to have a significant land holding which is not too constrained by existing buildings or land areas. This affords us the ability to plan holistically and deliver a comprehensively planned and integrated suite of products. What I believe differentiates Auckland Airport from many other airports, or other business parks, is the quality of the urban environment that we are creating and the way these areas will be integrated with one another.
We concentrate heavily on the customer experience and making the airport a great place to be - whether you work here, visit here if you are staying in our hotels, or if you are a passenger passing through. This focus is already paying dividends for us through increased leasing activity throughout the portfolio, and the high calibre of tenants who have recently committed to new developments here.
Can you give us any insight into what people can expect to see over the coming years?
Expect to see a turbo-charging of investment into aeronautical infrastructure. We have recently announced $1.8 billion in aeronautical infrastructure investment that will deliver new passenger terminal capacity, airfield and runway infrastructure, plus investments in roads and public transport infrastructure and much more.
In the short term, you will see changes in the international terminal where the international departure area is more than doubling in size, plus we will be providing an enhanced customer experience with a new border processing, security area, a new passenger lounge and a retail hub.
But the biggest change on the horizon, in my view, will be the development of the new domestic jet terminal that will joined to the international terminal which is currently in design and is programmed for completion by 2022. This will be a stunning development which will completely change the domestic experience for passengers arriving or departing from this terminal.
On the investment property business, expect to see a continuation of development momentum–more warehouse developments, more hotel development, and new office and retail schemes. A key enabler of this will be investments in transport infrastructure – we have already see the impact of projects like Waterview Tunnel that have enhanced the airport’s appeal because drivers can now get here from the CBD during off-peak traffic in less than 30 minutes.
Improvements in transport connectivity, both in terms of roads and public transport, is something people can also expect to see, which, we believe, will continue to position the airport as a very relevant option for businesses.