Infraero seeks private-sector partner to expand Congonhas

State airport operator Infraero is looking for a private-sector partner to unleash a project that will expand the passenger terminal of Congonhas, in São Paulo.

Budgeted at R$250 million, the project includes the construction of ten boarding and disembarking bridges, in a terminal extension that would reach operational areas used as parking for aircraft. The intention is to increase passengers’ level of comfort, without changing the overall airport’s capacity, whose traffic of takeoffs and landings is controlled by the National Civil Aviation Agency (Anac).

Today, only 41% of the 19.2 million passengers per year board or disembark through the bridges — the rest needs buses to arrive at remote locations. Infraero plans to increase this volume to about 80% after the expansion, which should be ready by late 2018 or early 2019, if the plans are carried forward.

Facing a financial crisis after handing over six major airports to the private sector, the state company bets on a new business model to get the project off the drawing board. André Luis Marques de Barros, Infraero’s commercial director, says that by mid-year a call for bids will choose the private partner. The winning company will shoulder 100% of the investment and must deliver the project in a 24-30 month period. The company will also pay for maintenance expenses.

In exchange, the winner will be able to operate commercially not only the new area, but also the entire terminal, paying a percentage of its revenues as a "premium" to Infraero. The contract would last for 25 years and Infraero would remain in charge of the entire operational side. "We hope to hold the bidding in this first half," Mr. Marques de Barros says.

The executive points out a number of advantages to this kind of partnership. In addition to accelerating the schedule of construction work, which is totally managed by the private sector and has no budget constraints, the company must meet quality indicators of services rendered in the terminal, such as cleaning of bathrooms.

On the other hand, the partner gets rid of bureaucratic requirements to operate a mix of shops and restaurants that meets demand accordingly. Today, under the law, Infraero makes its bids according to the largest amount of rent paid — it does not matter if the hamburger is yummy or the pizza is too hard.

Meanwhile, on another front, Infraero will launch a call for bids for companies interested in setting up businesses at the external area of Congonhas. The airport will have a second parking building, with a four-star hotel and a midsized shopping mall. "This space is one of the best assets we have in our entire network," says Mr. Marques de Barros, clarifying that no change will be required in any operating area. The number of parking spots will increase to 4,800 from the current 2,600. The contract will also last 25 years, while the investment also depends on the completion of technical studies.

Two recent Infraero bidding processes show that the market has appetite for this kind of partnership. Socicam, which manages bus terminals in São Paulo and Rio de Janeiro, won a bid to manage the entire commercial area of the new airport in Goiânia, capital of Goiás.

"We are in the final stage of signing the contract," Mr. Marques de Barros says. The terminal, which took almost ten years to be built and faced several stoppages in the works, is scheduled to finally open in April.

In addition to the upfront R$1 million payment, Socicam must pay R$745,000 monthly so Infraero can pay for the terminal’s maintenance expenses, estimated at R$300,000. The operational part — from check-in counters to airplane traffic — will remain with the state company. Socicam already manages regional airports such as Caldas Novas (Goiás), Zona da Mata (Minas Gerais) and Una-Ilha de Comandatuba (Bahia).

Another example was the call for bids for the parking building of international airport Afonso Pena, in Curitiba (Paraná), which was completed last week and is the largest commercial contract in Infraero’s history. The building will be built and operated by parking company Pare Bem, which offered the largest bid, of R$345.8 million.

The project includes a parking garage in an area of 80,300 square meters with three floors and potential of creating 2,400 jobs. There are plans also to cover 1,600 external parking spaces and improve parking signage. After signing the concession contract, the winning bidder will have 24 months to prepare and approve projects to build the new facilities, as well as to perform the work.

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