Andrew Tan loses bid for public-private partnership project for NAIA renovation

One of the losing bids for the PHP170.6-billion (about US$3.04-billion) public-private partnership project to modernize Ninoy Aquino International Airport (NAIA), Manila’s main aviation hub, was a consortium headed by well-known Philippine real estate and casino mogul Andrew Tan.

The idea was chosen, according to the nation’s Transport Secretary, Jaime Bautista, and a group led by San Miguel Corp (SMC).

The opening of Terminal 3 in 2014 marked the most recent major improvement to NAIA. Even though NAIA can only accommodate 32 million passengers at a time, at least 50 million go through it each year.

After the renovations are finished, NAIA’s runway capacity is expected to increase to at least 48 air traffic movements per hour, and 62 million passengers are expected to use it annually.

The government received the largest percentage share of future gross revenue (82.16 percent) from the winning consortium. They also have to pay the government an upfront payment of PHP30 billion and an annual payment of PHP2 billion for the duration of the contract, which has a 15-year initial term that may be extended by 10 years if needed.

The Department of Finance estimates that the 15-year concession would bring in over PHP900 billion in revenue, which is much more than the PHP22.05 billion in dividends that the Manila International Airport Authority (MIAA) gave to the government between 2010 and 2023.

The GMR Airports Consortium and the Manila International Airport Consortium, which included Mr. Tan, were outbid by the winning group, SMC SAP and Co group, who promised the government 33.3 percent and 25.91 percent of future profits, respectively.

The casino complex at Newport World Resorts, which is connected to the airport by a footbridge, has also been invested in by Alliance Global Group Inc., the firm founded by Andrew Tan.

Original story by: GGRAsia