Investments total USD735 million at Budapest Airport
As for AviAlliance and the consortium’s previous and future investments at Budapest, according to the CAPA Airport Construction Database around USD735 million in infrastructure investment was committed at the airport through to 2023. The planned investments include the construction of a new terminal building next to the existing terminal 2 and a new cargo city.
In Jun-2020 the airport completed the construction of pier 1 in terminal 2A, increasing the zone s surface area to 11,500sqm.
A long history of transactions
The airport having previously been state-owned, 75% of it was sold in 2005 to what was then the UK’s BAA plc for EUR2.6 billion (and at a very high earnings multiple of 29.3), when it was handling 7.8 million passengers per annum.
Analysis
The Vietnamese government has estimated that following a rapid pre-pandemic rise in passenger numbers, the requirement for airport infrastructure during the next five years will be twice what it was in the past five years.
Airports Corporation of Vietnam (ACV) reports that VND25 trillion (USD1 billion) has been invested in expanding airport infrastructure over the past five years to support passenger and cargo growth, but that it will need approximately VND120 trillion (USD5.2 billion) from 2021 to 2025 to complete infrastructure projects.
Vietnam s passenger and cargo traffic increased by an average of 17% and 13% respectively from 2012 to 2019.
However, there are questions about the selection of infrastructure projects, their geography, and whether traffic forecasts have been exaggerated.