- Are we getting fair market value?
- Were there other potential bidders, other then just MassPort?
Somehow this will all get done with an RFP. It really makes no sense that we need to put together an RFP for a 4 acre parcel of land, but will end of leasing the airport (all 1300 plus acres) without one. Even more ironic is that none of the 3 studies that we waited for so patiently the past couple of years (IMG, New England Regional Air Study and our Master Plan), which cost the tax-payers millions, did not even address the this issue??
14 comments:
An interesting read on Alliance Airport in Texas...
http://en.wikipedia.org/wiki/Fort_Worth_Alliance_Airport
http://www.allianceairport.com
Keep up the good work, Bill !!!
Harry Tembenis
Worcester, MA
Put yourself in the shoes of those who may bid on the current RFP which is for a 10 yr lease???.............if you 're going to be plunking down big bucks Wouldnt you want to know who will be running the place 2, 4, 8, or 12 years from now?
I.e. who you'll be repoting to, who your business associates will be up there,etc. Even if one is just renting an apt dont we always want to know how lives next door, above us, across the street, etc?
Jahn:
Great point. I was thinking the same thing.
Look at it from the other end, what if you knew who the mgmt was going to be then you may be more apt to bid on the current RFP. In other words the only entity that will bid on the current vacant parcel will already have close ties to MassPort and know exactly what the future holds for ORH.
Even worse, we get 5 or 6 bids and the losing bidders get a sense that the winning bidder is in bed with Massport and then all hell breaks lose. Might be baptism by fire for Joe early and more delays fro ORH.
True, true...
Harry Tembenis
Worcester, MA
Jahn/Bill/All:
Here is an Op-Ed Piece I wrote back in December 2004 to Worcester Magazine; kind of scary isn't it? My apologies of course, for Hooter's. Hindsite is always 20/20.
I still think Worcester should raise the stakes and invite Southwest Airlines to tour and possibly purchase ORH. Why? For the landing slots. Soutwest surrounds Jet Blue's service in Boston....Manchester, T.F.Green, Bradley, etc. Let them buy ORH and officially have a stranglehold on Jet Blue. The only obstacle to this 'Master Plan' happening is ORH being controlled/owned by Massport. You see the big picture?
In any event read the editorial from December 2004 and we can further discuss if need be:
Making the airport competitive
One man’s thoughts on reviving O’Brien Field
By Harry Tembenis
As a contrarian play on MassPort possibly abandoning the management of Worcester airport, rather than see this as a hardship for Worcester I see it more as an opportunity.
Why an opportunity? By getting MassPort out of the picture you single-handedly remove the biggest obstacle to opening discussions up with Southwest Airlines. Is there any coincidence in the fact that Southwest surrounds the Boston market (Providence, Hartford, Manchester) and chooses not to deal with the MassPort bureaucracy? If you land a big fish like Southwest, you now have a great bargaining chip when it comes to bringing in another up-and-coming discount carrier that was fed up with dealing with the Logan suits: Frontier Airlines. Then you can reopen negotiations with former carriers to Worcester, such as Carnival Airways, and quite possibly lure a new startup airline (Hooters, perhaps?). You now have a fine mix of discount carriers to lure Worcester County’s “Spag’s mentality” customers into utilizing the airport and setting Worcester apart from all the other New England airports as the first choice for quality, economical air travel.
This way you can tap your local clientele who know the area and can find the airport without the need of an access road. Also, do not neglect the possibility of luring Canadian discount airlines, such as Canjet, Jetsgo and ZIP, which could really exploit such an untapped market. All the major Northeast airports are served by Air Canada but none have these Canadian discount airlines offered in their mix of carriers as of yet. With Canadian airlines utilizing the airport, a name change from Worcester Municipal Airport to Worcester International Jetport (think Portland, Maine) would add a much-needed “prestige marketing” aspect to the airport’s image.
Another plus that could be spun off of Worcester airport is a tie-in with the downtown revitalization projects. With the founder of Peter Pan Bus Lines building a new luxury hotel and a new bus terminal in downtown Worcester, why not have the Chamber of Commerce work with Peter Pan about approaching the Connecticut casinos? There could be a charter flight-type promotion into Worcester, lodging at the new hotel and a chartered bus would be provided to the casinos. This could also hold true for rail service to the casinos, which would stimulate more business in the Union Station area as another added benefit.
As Worcester is also in the mix of the emerging biotechnology field, one of the carriers (most likely Southwest) could start a Biotech shuttle service from Worcester to the Raleigh/Durham Research Triangle Park area. As silly as that may sound, Worcester is right in the thick of emerging areas in biotechnology, putting it in a league with Boston, Austin, Raleigh/Durham and Southern California. Massachusetts and North Carolina are the two leading, emerging areas in this field. Such a service could add a boost to area hotels, restaurants, museums and high-profile conferences/conventions at the Centrum.
With few available slots at Logan, one of the carriers could also consider a knock-off of the successful New York shuttle service during peak business hours to offset Logan’s limited schedule. Let’s face it, MassPort never had Worcester’s best intentions at mind when they managed the airport. They most likely took up the management of the airport in order to make sure we didn’t get too successful so that another runway in Boston would not be needed. Seeing as MassPort has now gotten its way after a 20-plus-year battle to build a new runway, they have no need for Worcester.
Did anyone really think Boston wanted to funnel all that business to Worcester and other regional airports in New England? Unfortunately for us, we always have to play second-banana to Boston — Big Dig vs. Little Dig, Fleet Center vs. Centrum , Logan vs. Worcester Municipal, North/South station vs. Union Station , etc. We always end up with Boston’s token table scraps. Unlike other New England cities of our size — such as Providence, Hartford, Manchester, etc. — we are not a state capital (and yes, I know the capital of New Hampshire is Concord) and cannot utilize federal/state/city resources the way they can. In order to level the playing field we need to get creative.
Hopefully this idea can possibly help to steer us in that direction. For those who have read this far and still consider the Southwest idea somewhat of a long shot, think of this — Southwest currently utilizes T.F. Green, Bradley and Manchester airports. Logan just rolled out the red carpet for Southwest’s major competitor, JetBlue. What better way for Southwest to completely strangle Logan in the discount war than to get flights to consumers within a 45-mile radius of Logan, essentially undercutting JetBlue before they can establish themselves in the Boston market. A win/win scenario for both Southwest and Worcester. All is fair in love, war and the airport business.
As far as MassPort goes, they can go fly a kite.
Harry Tembenis lives in Worcester.Comments? E-mail
editorial@worcestermag.com.
Massport:
If you are reading this, I'm still for sale and my silence can be bought, otherwise I will continue my Matrix/Morpheus alter ego and continue to offer the red pill/blue pill...
Harry Tembenis
Worcester, MA
Don't know where I saw it but whoever said the turbulent waters of aviation is crazy. Leave the airline world out for a minute. The corporate and GA world is on fire right now. Every airport around ORH is building hangers like crazy. they are actually full before they are even built. Record numbers of new corporate jets have been ordered in 2006. The average number of hours flown in 2006 have gone up 100 hours per plane. That's why the big order rush. These planes need places to go and be hangered. They are also using secondary airports because of too much congestion. Sad to say the secondary airport they are using for the Worcester area is Fitchburg. Cheap fuel and better customer service. They don't feel like they are getting bent over like they do at ORH. That said. Fitchburg is lengthening their runway. If this happens, they will rob even more business from ORH. The city needs to see what is happening around us and in the industry. Just because the airlines are in termoil, doesn't mean the whole industry is. The rest of it is exploding with growth. There is a big time shortage of hanger space in the northeast. Every airport I know is capitolizing on this. We should be too.
I'm with Harry, tell massport to tike a hike.
Anonymous:
1) Harry is not necessarily telling MassPort to take a hike, but that he can be bought.
2) I remember Harry's editorial to WoMag and he had some great ideas.
3) Anonymous you are right about Fitchburg, General Aviation and hangars.
Anonymous what makes you think that the current management arrangement will take advantage of any of the positive things you identify, when they have not the past 8 years. How long did it take to put together an RFP for a 4 acre parcel?? Years.
ORH will never realize the potential that we all know it has, unless a new mangement team is brought in. RFP the airport and let the best offer win. Worcester simply does not belong in the airport business.
Watching The News Hour with Jim Lehrer the other night, aviation expert said aviation is a turbulent industry. Expenses are not keeping up with costs. I don't care if hangars are being built and runways extended, I'm interested in seeing the traveling public choose to fly to their destination because it is cost-efficient and safe. Expense and mishaps are eroding the once more-solid foundation of air travel. Therefore, it is turbulent.
FWIW...I heard a news story on radio thsi past week that said the commercial airline industry in approx 80 years of existence has made very, very littel money and quite poss. nothing.
Also, on another note, the airport manager was quoted somewhere as saying thatin the 50 or 60 years of ORH's existence, they havve put 40$M into the place.
Funnny how we difficulty getting financial data outt of ORH yet he has access to records goign back 60 years??. I am curious how he arrives at that 40M$ figure??
Most records get tossed after about 7 years ???
Guys, for the records, all businesses are turbulent. Nothing stays the same and management needs to adapt to stay ahead of the curves or opportunities pass them by. That is what has happened at ORH for too long--bad mgmt...
I always tell the example, when I got out of college in 1986 and Digital was the "THE" place to work.
What you will NOT hear from the City Hall establishment re: the ultimate disposition of ORH:
1. ORH is assessed for $30M +
2. If we sold it for $10M City would realize $250K in property tax annually.
3. If we sold it for $20M City would realize $500K in property tax annually.
4. If we sold it for $30M City would realize $750 annually in propert taxes.
5. Any sale proceeds could be invested to yield 10% annually over the long run. Assuming 20$M selling price thats another $2M annually for City treasury.
What you will hear when we lease ORH to Massport for short money:..........
How much Money Massport can get from Beacon Hill to invest in ORH......which Money will pale in comparison to the money lost by not selling to a private company.
Handing off ORH to Massport for chump change is a breach of the fiduciary duty the city has to its taxpayers to manage our assets properly.
Jahn:
You are right again. The day MassPort extending the current agreement three years is the day we should have started looking for someone else (PRIVATIZATION) to run ORH.
Instead we sat around and waited for three consultant reports, which ironicially,did not even address this issue. Actually I believe the original $100,000 IMG report, in fact, said that nobody would be interested and not to waste our time.
What I am trying to say is that the breach of the fiduciary responsibility started on July 1st, 2004, not now. Now any delay to wait for an RRP , that would take who knows how long (years), could be considered a breach of fiduciary responsibility.
I am convinced now that with 6 months left in the current operating agreement that MassPort will hold title or long-term lease (at least 30 years) ORH.
Post a Comment