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. I am a Lyft driver who is a licensed CDL professional driver. ALL Lyft drivers take pride in providing quality service to the Indianapolis and surrounding areas, and we take the safety of our passengers and the public seriously.(passengers are required to put seat belts on when they get in our cars) We do go through background checks, driving records are checked as are the personal cars we drive, (these are OUR private cars we use) Unlike taxi cabs and their drivers Lyft (and yes Uber) provide passengers with a clean car inside and out, a friendly and courteous driver, and who is dressed appropriately and is groomed appropriately. I go so far as to offer mints, candy and/or small bottle of water to the my customers. It's a mutual respect between driver and passenger. With Best Regards

    2. to be the big fish in the little pond of IRL midwest racin' when yer up against Racin' Gardner

    3. In the first sentance "As a resident of one of these new Carmel Apartments the issue the local governments need to discuss are build quality & price." need a way to edit

    4. As a resident of one of these new Carmel Apartments the issue the local governments need to discuss is build quality & price. First none of these places is worth $1100 for a one bedroom. Downtown Carmel or Keystone at the Crossing in Indy. It doesn't matter. All require you to get in your car to get just about anywhere you need to go. I'm in one of the Carmel apartments now where after just 2.5 short years one of the kitchen cabinet doors is crooked and lawn and property maintenance seems to be lacking my old Indianapolis apartment which cost $300 less. This is one of the new star apartments. As they keep building throughout the area "deals" will start popping up creating shoppers. If your property is falling apart after year 3 what will it look like after year 5 or 10??? Why would one stay here if they could move to a new Broad Ripple in 2 to 3 years or another part of the Far Northside?? The complexes aren't going to let the "poor" move in without local permission so that's not that problem, but it the occupancy rate drops suddenly because the "Young" people moved back to Indy then look out.

    5. Why are you so concerned about Ace hardware? I don't understand why anyone goes there! Every time ive gone in the past, they don't have what I need and I end up going to the big box stores. I understand the service aspect and that they try to be helpful but if they are going to survive I think they might need to carry more specialty parts.

    ADVERTISEMENT