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Chicago MDW To Be Sold To Investors  
User currently offlineWarreng24 From United States of America, joined Nov 2005, 708 posts, RR: 0
Posted (7 years 10 months 2 weeks 4 days 3 hours ago) and read 3245 times:

Didn't see this posted yet.... (Mods please delete if a duplicate).

http://money.cnn.com/magazines/fortu...7/index.htm?postversion=2007021205


"Goldman Sachs, Deutsche Bank, Australian infrastructure specialist Macquarie (Charts) and Spanish airport operator Ferrovial are all circling the 750-acre Chicago airfield, which could fetch up to $3 billion. "

"Then there are the economic issues - 65 percent of the carriers at Midway have to approve the transaction, and they may require that landing fees (the charges they pay to the airport operator) be capped. The bidders, on the other hand, will push for a fee schedule that gives them a decent return on their equity. In the past, airlines have argued that privatization can exacerbate an airport's natural monopoly if landing fees and other economic concessions are not regulated."


WN is one of the largest carriers active at MDW. If the sale goes through and landing fees increase, could we potentially see WN move to one of the other Chicago area airports?

7 replies: All unread, jump to last
 
User currently offlineXJET From United States of America, joined Feb 2007, 492 posts, RR: 2
Reply 1, posted (7 years 10 months 2 weeks 4 days 3 hours ago) and read 3221 times:

Quoting Warreng24 (Thread starter):
WN is one of the largest carriers active at MDW. If the sale goes through and landing fees increase, could we potentially see WN move to one of the other Chicago area airports?

I would think WN would stay. They have invested way too much into that airport. It is an interesting situation though. We can all look to ELP to see how WN handles high fee airports.


User currently offlineCubsrule From United States of America, joined May 2004, 23308 posts, RR: 20
Reply 2, posted (7 years 10 months 2 weeks 4 days 2 hours ago) and read 3175 times:

Quoting XJET (Reply 1):
I would think WN would stay. They have invested way too much into that airport. It is an interesting situation though. We can all look to ELP to see how WN handles high fee airports.

Nowhere else in the area has the space for WN. If WN were to pull back due to increased fees, FL would expand in a heartbeat.

And if it requires 65% of the 8 carriers at the airport, that would mean that if TZ and WN oppose the deal, every other carrier would have to be in favor of it.



I can't decide whether I miss the tulip or the bowling shoe more
User currently offlineSphealey From United States of America, joined May 2005, 378 posts, RR: 0
Reply 3, posted (7 years 10 months 2 weeks 4 days 2 hours ago) and read 3169 times:

How many here remember who the original owner of MDW was?

sPh


User currently offlineXJET From United States of America, joined Feb 2007, 492 posts, RR: 2
Reply 4, posted (7 years 10 months 2 weeks 4 days 2 hours ago) and read 3169 times:

Quoting Cubsrule (Reply 2):
And if it requires 65% of the 8 carriers at the airport, that would mean that if TZ and WN oppose the deal, every other carrier would have to be in favor of it.

Oh yeah. I totally think they wil stay 100%. It will just be interesting to see the airport have a hand over WN.


User currently offlineJakbar From United States of America, joined Oct 2003, 442 posts, RR: 22
Reply 5, posted (7 years 10 months 2 weeks 3 days 3 hours ago) and read 2836 times:

For the sake of clarity, MDW is not being "sold", but instead is being "privatized", a completely different concept. The City of Chicago will continue to own MDW.

Quoting Sphealey (Reply 3):
How many here remember who the original owner of MDW was?

I believe the Chicago Board of Education originally owned the land. If I'm not mistaken, they owned the land well into the 1980s.

[Edited 2007-02-13 16:08:10]

User currently offlineSphealey From United States of America, joined May 2005, 378 posts, RR: 0
Reply 6, posted (7 years 10 months 2 weeks 3 days 2 hours ago) and read 2812 times:

> I believe the Chicago Board of Education originally owned the land.
> If I'm not mistaken, they owned the land well into the 1980s.

Correct, although I am not sure if the BoE ever owned the facilities. IIRC the land was sold to the City of Chicago in either 1979 or 1980.

sPh


User currently offlineFWAERJ From United States of America, joined Jun 2006, 3833 posts, RR: 2
Reply 7, posted (7 years 10 months 2 weeks 2 days 21 hours ago) and read 2678 times:

Quoting Jakbar (Reply 5):
For the sake of clarity, MDW is not being "sold", but instead is being "privatized", a completely different concept. The City of Chicago will continue to own MDW.

To put it into perspective, it's sort of like what BAA does at IND.

Anyhoo, it doesn't surprise me that Macquarie is in the bidding... a joint-venture group between them and Cintra leases the Chicago Skyway from the City of Chicago (along with the Indiana Toll Road on the other side of the state line). Given the "corrupt but effective" nature of Chicago politics (thank you, Mayor Daley), I think that Macquarie will win this one by default. This reminds me of the time when McDonald's (based in the Chicago suburb of Oak Brook) won the fast-food burger bid at ORD becuase they were "local" (and Daley got a lot of kickbacks from McDonald's), even though a local Burger King franchisee based in Chicago proper said "we're just as local as McDonald's".

BTW, before I moved to the FWA area, I lived in NW Indiana, so MDW and ORD were my hometown airports (though if GYY had decent service, we would have used it).

[Edited 2007-02-13 21:41:01]


"Did he really need the triple bypass? Or was it the miles?"
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