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Private investment in airport infrastructure is popular again: the growing importance of the PPP

Privatisation of airports, or at the very least their corporatisation into independent business units that behave along business lines, has again become fashionable. This follows a dip in transactions and prices during the period of the global financial downturn from 2008-2012. Money is now easier to obtain and air transport infrastructure is popular with investors as it typically has a long term cycle attached to it, usually quite the opposite of the airlines that use it.

For now at least traffic figures are rising and airport EBITDAs with them, along with the earnings multiples when they are sold. What is more, the activity is across the board - in PPPs, BOTs, trade sales, even IPOs.

Meanwhile, for the airlines, this is the first time for decades that they are not caught up in a fight for survival. And on the other side, many countries are facing low levels of economic growth where infrastructure funding, while vital, is not possible out of the public purse.

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