IBJNews

Airport could land $63M annually from land redevelopment

Back to TopCommentsE-mailPrintBookmark and Share

A long-term land-use plan approved Friday morning by the Indianapolis Airport Authority board could generate up to $63 million for the airport annually by 2040, according to a consulting firm.

International aviation cunsultancy Landrum & Brown pegged the potential annual revenues at $30 million to $63 million from seven development zones identified for Indianapolis International Airport and its smaller reliever fields in the metro area.

Besides predictable uses such as cargo and logistics firms, the plan includes offbeat uses such as construction of a solar-energy farm at the southwest corner of the airfield, near Interstate 70.

The only hitch for the ambitious land reuse plan is that the airport authority might have to pay back the Federal Aviation Administration up to $17.4 million for land that had previously been developed with federal funds.

At Indianapolis International, the report contemplates 50 development sites, or 59 million square feet of leasable land. 

The study identified 2.5 million square feet of development potential at Metropolitan Airport in Fishers and 4.6 million square feet at Indianapolis Regional Airport in Hancock County, formerly known at Mount Comfort Airport.

The study concluded that Eagle Creek Airport and the downtown heliport should be preserved largely for aviation purposes.

The potential of generating up to $63 million for the airport annually is based on land-rent income only, Berta Fernandez, executive vice president of Landrum & Brown, told the board.

But it’s likely the airport, in conjunction with other governmental entities affected by the airport, will have to offer incentives to lure businesses. Competition is already robust among other communities and other states waving around tax abatements and other lures.

 “They [businesses] all indicated some sort of incentive package will be needed,” said Mark Hedegard, senior director of business development for the authority.

Those incentives could also come in the form of infrastructure improvements to airport property.

To a person, developers stressed that the market for development is still challenging and likely will be in the short term, Hedegard added.

But, he said of the plan ‘they thought it was well-thought out.”

Another carrot to developers likely will be in how leases are structured.

“If you’re going to do any kind of real estate development, we typically like to get a [long-term] lease,” said Mike Wells, president of Indianapolis-based REI Real Estate. Wells added that leases as long as 99 years aren’t uncommon for some projects to stoke interest.

Airport officials this year will focus on such areas as developing incentives and marketing initiatives, conducting environmental assessments and working with the FAA on land-use changes. The airport has already set aside $1 million for land-use work this year.

“The FAA has been supportive” of the concepts, said Hedegard.

Among the first projects could be the solar-farm concept as well as gas and retail development at Indianapolis International.

The old terminal, because of its proximity to runways and to neighboring interstates, likely will be home to air cargo and logistics-related redevelopment.

The plan will influence airport development for decades to come.

Last year, the authority hired Landrum & Brown to develop the plan, with input from local government and business leaders.

“It is the intent of the IAA to lease, not sell, land-development sites and to look to the private-sector development community to assume financial risk on future development opportunity,” airport staff said in a memo to the board.

The resolution approved Friday states that “wherever and whenever practicable” the authority will return designated airport real estate, developed for non-aviation purposes, to the tax rolls.

For years, jurisdictions such as Decatur Township have complained that the expanding airport land holdings, which are tax-exempt, have hurt their tax base.

ADVERTISEMENT

  • Make it an International Terminal
    and attract international flights, hence more job growth and more business. Distribution companies aren't a win win, you want results you attract international.
  • return property to tax rolls
    Actually, even if the fire departments are consolidated, the schools will not be and they account for half of all property taxes paid.

    The $30 - $65 million the airport claims could be theirs every year, is the amount of money they would get from leases. The lease amounts would be less than the property taxes paid on that land, if the land were returned to the tax rolls. This simply amounts to a net effect where the airport takes property tax money for its operations and the companies that locate on that property get permanent abatements. This will allow an unequal playing field for nearby businesses that have to pay their entire property tax bills.
  • of course
    Decatur Twp's argument is void if Indiana does away with township government this year...

    Post a comment to this story

    COMMENTS POLICY
    We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
     
    You are legally responsible for what you post and your anonymity is not guaranteed.
     
    Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
     
    No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
     
    We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
     

    Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

    Sponsored by
    ADVERTISEMENT

    facebook - twitter on Facebook & Twitter

    Follow on TwitterFollow IBJ on Facebook:
    Follow on TwitterFollow IBJ's Tweets on these topics:
     
    Subscribe to IBJ
    1. Socialized medicine works great for white people in Scandanavia. It works well in Costa Rica for a population that is partly white and partly mestizo. I don't really see Obamacare as something aimed against whites. I think that is a Republican canard designed to elicit support from white people for republican candidates who don't care about them any more than democrats care about the non-whites they pander to with their phony maneuvers. But what is different between Costa Rica nd the Scandanavian nations on one hand and the US on the other? SIZE. Maybe the US is just too damn big. Maybe it just needs to be divided into smaller self governing pieces like when the old Holy Roman Empire was dismantled. Maybe we are always trying the same set of solutions for different kinds of people as if we were all the same. Oh-- I know-- that is liberal dogma, that we are all the same. Which is the most idiotic American notion going right back to the propaganda of 1776. All men are different and their differences are myriad and that which is different is not equal. The state which pretends men are all the same is going to force men to be the same. That is what America does here, that is what we do in our stupid overseas wars, that is how we destroy true diversity and true difference, and we are all as different groups of folks, feeling the pains of how capitalism is grinding us down into equally insignificant proletarian microconsumers with no other identity whether we like it or not. And the Marxists had this much right about the War of Independence: it was fundamentally a war of capitalist against feudal systems. America has been about big money since day one and whatever gets in the way is crushed. Health care is just another market and Obamacare, to the extent that it Rationalizes and makes more uniform a market which should actually be really different in nature and delivery from place to place-- well that will serve the interests of the biggest capitalist stakeholders in health care which is not Walmart for Gosh Sakes it is the INSURANCE INDUSTRY. CUI BONO Obamacare? The insurance industry. So republicans drop the delusion pro capitalist scales from your eyes this has almost nothing to do with race or "socialism" it has to do mostly with what the INSURANCE INDUSTRY wants to have happen in order to make their lives and profits easier.

    2. Read the article - the reason they can't justify staying is they have too many medicare/medicaid patients and the re-imbursements for transporting these patient is so low.

    3. I would not vote for Bayh if he did run. I also wouldn't vote for Pence. My guess is that Bayh does not have the stomach to oppose persons on the far left or far right. Also, outside of capitalizing on his time as U. S. Senator (and his wife's time as a board member to several companies) I don't know if he is willing to fight for anything. If people who claim to be in the middle walk away from fights with the right and left wing, what are we left with? Extremes. It's probably best for Bayh if he does not have the stomach for the fight but the result is no middle ground.

    4. JK - I meant that the results don't ring true. I also questioned the 10-year-old study because so much in the "health care system" has changed since the study was made. Moreover, it was hard to get to any overall conclusion or observation with the article. But....don't be defensive given my comments; I still think you do the best job of any journalist in the area shedding light and insight on important health care issues.

    5. Probably a good idea he doesn't run. I for one do not want someone who lives in VIRGINIA to be the governor. He gave it some thought, but he likes Virginia too much. What a name I cannot say on this site! The way these people think and operate amuses me.

    ADVERTISEMENT