Developing aerotropolis is a recent conceptualization to build smart cities with sharp focus of eco-innovation and green economy. In a modern aerotropolis, the infrastructure is so built that it connects the megacity with massive road, transport systems and ICT network in one hand; provides key linkages and services for the international businesses on the other hand. In recognition to these emerging modern trends this fourth article from our collaborator Dr. A.N.Sarkar is dedicated to discuss and showcase the recent eco-innovations made in developing aerotropolis world over on a selective case study basis.
Airports have always been key nodes in global production systems offering speed, agility, and connectivity. To increase the speed with which companies are able to respond to customer orders, many warehouse and distribution companies, as well as logistics companies, have located close to airports. Increasingly, now, manufacturing companies are also locating close to airports to minimize the distance between the place of manufacture and the location of transport. In this way, products can move quickly off the assembly line and onto the freighter. The concentration of these manufacturing activities acts as a magnet to attract other supporting knowledge and service industries.
These connected trends have led to the emergence of a new form of airport-centric commercial development called the aerotropolis. This trend has transformed “city airports” into “airport cities.” This trend also positions airports as 21st century drivers of business location, urban economic growth and global economic integration- a core objective of the WTO. The aerotropolis are also powerful engines of local economic development, attracting aviation-linked businesses of all types that are attracted by the ability to get their products to customers around the world. Increasingly, these companies include, among others, time-sensitive manufacturing and distribution facilities, as well as hotel, entertainment, retail, convention, trade and exhibition complexes, eco-tourism industry etc.
From “city airports” to “airport cities.” Airports on 21st century are drivers of business location, urban economic growth and global economic integration
Airports like cities are never static. They are constantly evolving in form and function. Historically, airports have been understood as places where aircraft operate, including runways, control towers, terminals, hangers and other facilities which directly serve aircraft, passengers and cargo. This traditional understanding is giving way to much broader, more encompassing concept known as the ‘Airport City’ which has became the 21st century way forward for many airports. The Airport City model is grounded in the fact that in addition to their core aeronautical infrastructure and services, major airports have developed significant non-aeronautical facilities, services and revenue streams. At the same time they are extending their commercial reach and economic impact well beyond airport boundaries.
In recognition to these emerging modern trends sub-serving the growing interests of the fast changing lifestyle, this paper is dedicated to discuss and showcase the recent eco-innovations made in developing aerotropolis world over on a selective case study basis.
Sustainable Aerotropolis: Scanning the Global Scene
Key features that are commonly implemented in aviation terminal design include increased natural light, energy -saving bulbs, recycling programmes, green materials and more efficient utility systems. In addition to environmental concerns, airports are additionally starting to consider the social and economic implications and opportunities that especially impact the surrounding communities. According to the Federal Aviation Administration, sustainable airports (Figure 1):
- Reduce environmental impacts
- Help maintain high, stable levels of economic growth
- Help achieve “social progress,” a broad set of actions that ensure organizational goals are achieved in a way that is consistent with the needs and values of the local community
"The rapid expansion of airport-linked commercial facilities is making today's air gateways anchors of 21st century metropolitan development where distant travelers and locals alike can conduct business, exchange knowledge, shop, eat, sleep, and be entertained without going more than 15 minutes from the airport. This functional and spatial evolution is transforming many city airports into airport cities." - Dr. John Kasarda
Major international airports have developed over time into key nodes in global production and enterprise systems through speed, agility and connectivity. These transportation hubs are able to dramatically stimulate local economies by attracting a wide range of aviation-related businesses to their peripheries and resulting in what John Kasarda, a US academic who studies and advises governments on city planning issues, has dubbed the "Aerotropolis." The Aerotropolis, like any other traditional city, consists of a central core with rings of development permeating outwards; unlike a traditional city, however, the city's core is an airport and all neighboring development supports and is supported in turn by the airport industry. Several airports around the globe have organically evolved into these airport-dependent communities, generating huge economic profits and creating thousands of jobs, but what Kasarda is arguing for is a more organized and purposeful approach to the development of these Aerotropolises -what he believes to be the future model of a successful city. Kasarda claims that the cities that will thrive in the 21st century will be those with airports and their centers, for "efficient, large, well-connected airports matter to prosperity above everything else" and "the fastest, best-connected places will win."
Major airports are developing significant non-aeronautical facilities, services and revenue streams. John Kasarda has dubbed them "Aerotropolis”
A nation's airports are undeniably vital contributors to the economy. Chicago's O'Hare International Airport for example, is the 2nd largest office market in the Mid-west, and Washington Dulles's airport area alone has more retail sales than any other American city besides Manhattan. Detroit, a city that is seriously considering a new airport development to stimulate its struggling economy, would generate $10 billion in annual economic activity, $171 million in annual tax revenue and would create and sustain 64,000 jobs after 25 years. The development of aerotropolis around the megacities of the world is all together a recent conceptualization to build smart cities with sharp focus of eco-innovation and green economy. In a modern aerotropolis, the infrastructure is so built that it connects the megacity with massive road, transport systems and ICT (i.e. The Internet of Things) network in one hand; provides key linkages and services for the international businesses on the other hand.
Airport terminals are fast becoming luxurious shopping malls and artistic and recreational venues. No longer restricted to magazine shops, fast food outlets, and duty free, they now feature brand name boutiques, specialty retail, and upscale restaurants along with entertainment and cultural attractions. Hong Kong International, for instance, hosts more than 30 high-end designer clothing shops. Singapore Changi offers cinemas, saunas, and a tropical butterfly forest, while Las Vegas McCarran has a museum and Amsterdam Schiphol a Dutch Master’s art gallery.
Others doing things differently include Frankfurt’s Flughafen–which has the world’s largest airport clinic serving over 36,000 patients yearly– and Detroit Metro whose swank 420 room Westin Hotel is located just off its main terminal concourse as is Dallas Ft. Worth’s Grand Hyatt hotel which serves as a fly-in virtual corporate headquarters for many U.S. businesses. Beijing Capital Airport’s tenants include banks while Stockholm Arlanda’s intensively utilized chapel conducted nearly 500 weddings in 2007. Most major airports, of course, are diversifying, expanding, and upgrading their retail offerings, often incorporating shopping streets, gallerias, gourmet and culinary clusters, and arts, entertainment, and cultural zones. These are being complemented by local themed merchandise and dining outlets.
A number of aerotropolis clusters are emerging, especially in Europe and Asia. These clusters include not only the airport city, but also a region of adjacent business development around the airport core that is referred to as an airport edge-city. For example, in Europe, Amsterdam Zuidas, located six minutes from Schipol Airport, is developing as a headquarters for global companies. Hong Kong’s SkyCity is similarly being developed with office, retail and entertainment facilities. In the U.S. we can see the aerotropolis developing around cities such as Dallas Fort-Worth, Detroit and Memphis. Aerotropoli are most prevalent in Europe and Asia and even in the Middle East. In fact, Dubai is the world’s largest aerotropolis. Governments in these regions see the aerotropolis as a vehicle for promoting economic growth and trade within and to their countries. In many of these locations, large “greenfield” sites are available so that the aerotropolis can be built from scratch. However, the aerotropolis concept is taking hold in the developed world, especially in U.S. cities such as Atlanta, Detroit, and Philadelphia. These cities are leveraging their airport areas with strategic, multi-use developments. In the U.S. Memphis, home of FedEx, is often cited as an emerging aerotropolis.
Aerotropolis clusters are emerging, especially in Europe and Asia, including not only the airport city, but also a region of adjacent business development around the airport core
Regional Context of Aerotropolis
An aerotropolis is a region that develops and grows within an airport and related activities as central economic growth drivers and the hub of economic activity. The region as a whole may gain a competitive advantage over other business centers by utilizing the mutual synergies between various business types, proximity to transportation infrastructure and with each other. At a micro scale, a typical aerotropolis may include separate zones for office business parks, hotels, logistics parks, industrial parks, e-commerce centers, retail centers, distribution centers, information technology complexes and wholesale merchandise marts that may benefit by locating themselves around an airport and along the transportation corridors surrounding them. Additional regional amenities such as convention centers, and entertainment complexes can add value to any typical aerotropolis development. The business core may be surrounded by mixed-use residential areas. A multi-modal transportation hub provides transit connectivity for regional population to key areas of the aerotropolis (Figure 2).
As aviation-related businesses cluster around airports with good access to ground transportation, a new business concept is emerging globally: the Aerotropolis. Designed to attract economic investment and workforce talent, an Aerotropolis is an urban planning area in which the infrastructure and economy center on an airport. In 2011, Time Magazine featured the Aerotropolis concept as one of “ideas that will change the world.” The East County Economic Development Council (ECEDC) has begun studying the best ways to create an Aerotropolis surrounding county-operated Gillespie Field, a public airport in El Cajón. The ECEDC and the South County Economic Develop¬ment Council (SCEDC) jointly have received a $40,000 grant from the U.S. Economic Development Administration to de¬velop Aerotropolis plans surrounding both Gillespie Field and San Diego’s Brown Field Municipal Airport in Otay Mesa (Figure 3). One of the goals is to determine which industry clusters can best enhance economic development, increase invest¬ment, and create higher paying jobs. Although it is collaborating with the SCEDC, the East County group’s main focus will be on Gillespie Field, said Santee City Councilman John Minto, chairman of the ECEDC. In addition to the $40,000 grant, the ECEDC has “re¬ceived another $50,000 from the San Diego Foundation and we are matching with some internal money as well,” said Jo Marie Diamond, president and CEO of the council. If successful, an Aerotropolis could become a catalyst for economic growth that benefits the entire East County community, she explained. “The underlying premise is an Aerotropolis is an economic accelerator.”
The Wall Street Journal reports that in countries like Dubai, China, India, and continents like Africa, cities are being built from scratch around air travel. The ECEDC’s goal is to create a business hub where travelers and locals can conduct business, shop, and dine. This would benefit manufacturing and distribution facilities; hotels; retail stores; commercial offices; conference centers; and entertainment venues.
In addition to incorporating a variety of commercial and entertainment venues into passenger terminals, airports are developing their landside areas with hospitality clusters, office and retail complexes, conference and exhibition centers, logistics and free trade zones and facilities for processing time-sensitive goods. Revenues from such developments are being reinforced by major financial streams from advertising and parking. Consequently, many airports now receive greater percentages of their revenues from non-aeronautical sources than from aeronautical sources (e.g., landing fees, gate leases, passenger service charges). For some, such as Atlanta, Dallas, Hong Kong and Schiphol, non-aeronautical activities contribute approximately two-thirds of total airport revenues. These non-aeronautical revenues have become critical to airports meeting their facility modernization and aeronautical infrastructure expansion needs, along with their being cost-competitive in attracting and retaining airlines.
With the airport itself serving as a region-wide multi-modal transportation and commercial nexus, strings and clusters of airport-linked business parks, information and communications technology complexes, retail, hotel and entertainment centers, industrial parks, logistics parks, wholesale merchandise marts and residential developments are forming along airport arteries up to 20 miles outward. Economic impact has been measured up to 60 miles from some major airports.
Powerhouse of Tremendous Economic Potential
Aerotropolis, mostly built around big-size metropolis is a powerhouse of tremendous Aviation-mode transport and economic potential; especially for export-oriented international business, technology park, eco-tourism etc. Cited below are some of the illustrative cases of Aerotropolis with focus of eco-innovation and technological marvels.
1) Gilespie Field San Diego County
“What does that do for the community?” Craver asked. “It increases the tax base. It increases the economic viability of the area. It will create jobs, which is something we desper¬ately need.” The ECEDC has determined that the airport and its busi¬ness parks now contribute over $400 million per year to the local economy and provide nearly 3,200 jobs. In terms of the number of operations, Gillespie Field ranks No. 1 among San Diego County airports. It also generates enough revenue to cover operations at all of San Diego’s regional airports. This revenue comes from airport operations and property taxes on the surrounding industrial area. There are 55 acres in aviation use and 37 acres of industrial use land available for development. Diamond explained that the aerotropolis concept is about developing businesses outside the airport gates. The planning area could extend for miles beyond Gillespie Field, but there are no plans to participate in development of the airport itself.
Dana Quittner, an education consultant who chairs the ECEDC’s Gillespie Field Committee, said one of the things that makes the airport a good aerotropolis candidate is its strategic location near several freeways: State Route 52 on the north, Interstate 8 to the south, State Route 67 on the east, and State Route 125 on the west.
Smart Growth Perspective
An aerotropolis should incorporate “smart-growth” concepts. That means compatible development near residential communities, schools, and existing transit would reduce the need for people to make long driving commutes. This strategy supports the economy and protects the environment. A recent Caltrans Airport Forecasting Study found that education and employment trends have created a demand for office and commercial growth that is compatible with de¬velopment near Gillespie Field.
AMany airports now receive greater percentages of their revenues from non-aeronautical sources than from aeronautical sources
2) City of Ledu, Alberta, Canadá
Although an aerotropolis concept applies to a broader area on all sides surrounding the airport, approximately 640 acres of undeveloped land is currently available for future development and is located immediately south of the Edmonton International Airport and west of Queen Elizabeth II Highway. The site can also be accessed via local road networks from existing low density residential neighborhoods such as Bridgepoint and Deer Valley. It is located within the existing City boundary and is privately owned. The aerotropolis project in the City of Leduc began in 2009. The unique approach utilized by the City included modeling air, traffic and ground noise around the airport and developing a policy plan called ‘Aerotropolis Integrated Land-use’.
Compatibility Plan (AILUCP). This is a 50-year document designed to protect the current and future development on lands abutting the Edmonton International Airport, as well as protecting the airport’s present and future operational needs. This plan highlights the potential of the undeveloped area immediately south of the Edmonton International Airport to become one of North America’s premier warehousing, distribution, and multi-modal hubs. The report also stresses that in addition to offering long-term economic growth, the future development should also provide for local community needs by supplying sufficient land for commercial, recreational and office space
City of Leduc Municipal Development Plan (MDP)
City of Leduc’s Municipal Development Plan (MDP) designates the subject site as predominantly ‘Aerotropolis Business Industrial’ development with transitional residential and business mixed uses along the southern portion of the site adjacent to existing low density residential neighbourhoods as shown in the following diagram. In addition, a variety of commercial development policies support development of industrial and business parks on subject sites with focus on a wide range of uses such as industrial, logistics, warehouse, distribution, eco-industrial, agro/food-business and high-quality office park. The MDP policies provide a strong framework for future development of this site as one of North America’s leading aerotropolis projects.
Leduc County Inter- Municipal development Plan (IMDP)
The City of Leduc and Leduc County Inter-municipal Development Plan (IMDP) is consistent with the City of Leduc Municipal Development Plan and designates a predominant portion of the subject site as E1-Port Alberta Business Industrial policy area. This policy area provides a framework for future business industrial developments consistent with the future vision for Port Alberta. The southern portion of the site is designated for transitional residential uses.
The design Charrette, held on October 19, 2012 with over 30 attendees, was established to strategize how best to utilize land and integrate economic activities south of the Edmonton International Airport. Groups represented included: Alberta Transportation, Edmonton International Airport, Edmonton Regional Airports Authority, Port Alberta, Melcor Developments etc. The presence of diverse stakeholders ensured a comprehensive dialogue and a
creative exercise for establishing future vision for the site. The format of the day began with a keynote presentation from airport transportation planning expert Prof. Douglas Baker from Queensland University of Technology, Brisbane, Australia.
The participants were divided into 5 separate groups. The charrette exercise was divided into two parts. In the first part, each table discussed ongoing initiatives within the area and their values for potential development. This exercise was helpful in establishing trust and breaking down communication barriers. It also established a strong foundation for the design exercise. In the second part, all groups were tasked in visually describing, sketching and mapping future land uses, infrastructure, economic activities and housing. After more than an hour of designing, the groups presented their concepts to the others with time for questions and discussion. There was visible unity in the designs, programs, and needs as well as a sense of development cohesion among the group; participants agreed upon the majority of requirements that were needed to make this area a successful future aerotropolis.
3) India's new airport privatization models
Fueled by its booming economy and rapidly rising personal incomes, India’s commercial air travel grew by over 20 percent annually between 2000 and 2007. Such high passenger growth is expected to continue. Since India’s airport infrastructure is ill-equipped to accommodate such dramatic growth, the Ministry of Civil Aviation set about a two-fold process. First, private-sector capital and leadership were brought in through public-private partnerships to modernize and expand existing major airports and build new airports. Second, Airport City and Aerotropolis models of development were encouraged to generate commercial development at and around India’s airports to foster economic development, increase their non-aeronautical revenues, and further boost passenger and cargo flows. India’s GMR Group is heading the public-private partnership to modernize and expand Delhi International Airport (under the consortium name Delhi International Airport Limited (DIAL). This firm is also constructing and operating a brand new Greenfield airport at Hyderabad (Hyderabad International Airport Limited, HIAL), which opened in March 2008. These two airports nicely capture India’s 21st century approach to airport city and aerotropolis development.
A) The Delhi aerotropolis
Delhi’s International Airport, which spans 5,000 acres, was handed over to GMR in May 2006. In short order, plans were implemented for a new runway (the third) at DIAL and the new integrated passenger terminal (Terminal 3) capable initially of handling 30 million annually and expandable afterwards. The third runway began to be operational by late 2008, and the integrated (domestic and international) passenger terminal by 2010. Terminal 3 is state-of-the-art in every respect, providing modern passenger amenities and services along with 55 aircraft contact stands and 20 remote stands. Departing and transfer passengers have a significant complement of retail and service options to experience measuring up to those at terminals such as Singapore Changi, Frankfurt, and Hong Kong International, including a 300-room, four-star passenger transit hotel connected to the terminal.
B) GMR (Hyderabad) Aerospace & Industrial Park
With more aerospace and industrial players looking to India for setting up their operations, there is a need for specialized infrastructure providers to support aerospace & industrial growth. Leveraging GMR Group’s experience in highways, energy and airport projects, the group presents ‘GMR Aerospace & Industrial Park’ an aerospace & industrial cluster as part of GMR Hyderabad International Airport. The site location of GMR Aerospace and Industrial Park has been strategically chosen with emphasis on connectivity. The Park is well connected by air, road and rail, including robust connectivity to ports. This strategic location offers businesses an easy access to suppliers, enabling efficient supply chain management. These linkages present the benefits of faster turn-around time and maximization of productivity.
Why GMR Aerospace & Industrial Park?
GMR Aerospace & Industrial Park provides ‘ready-to-use’ industrial infrastructure allowing companies to focus on their core business (Figure 4). GMR Aerospace & Industrial Park offers the flexibility of choosing land within Special Economic Zone (SEZ) for businesses looking to serve foreign markets, and land in Domestic Tariff Area for businesses looking to serve Indian market. By virtue of the park being housed within RGIA, the Aerospace & Industrial Park enjoys greater security. Supply of utilities like power and water are highly reliable. The park also enjoys the complete airport ecosystem like availability of hotel, reliable and affordable transport, emergency services, security, etc.
The following advantages present a strong case for GMR Aerospace & Industrial Park’s vision of creating an Aerospace & Industrial cluster in the region.
- Runway access
- Ready-to-use infrastructure
- Benefits of Special Economic Zone (SEZ) and
- Free Trade Zone (FTZ)
- Significant presence of aerospace companies and SMEs in Hyderabad
- Benefits of being part of a cluster
- Attractive lifestyle at low cost
- Excellent location and connectivity
- Robust talent pipeline
Global energy crises and alarming climate change patterns observed in past couple of decades, principally resultant from high emissions level and global warming, has been a serious concern of the global community at large; as rightly expressed in the concluding session of the Global Climate Summit (COP21) recently held in Paris. According to the learning made from the analysis of the cited case studies in the paper, the concept of aerotropolis; together with eco-industrial clusters, should essentially constitute the broad framework for developing future strategies and initiate appropriate action-oriented programs to mitigate and therefrom suitably adapt future eco-innovations, allowing formulation of new plan of action for a chain of new aerotropolis based on their existing and future economic potential, coupled with environmental safeguards. This will effectively help develop gradual and incremental growth (based on Kaizen Principles) of eco-towns starting off from the local-level initiatives at eco-village-cluster levels; and graduating therefrom into building on ambitious aerotropolis to help promotion of sustainable green economy in a mutually inclusive (with participation of green community) and yet competitive and sustainable manner in future.
By Dr. A.N.Sarkar
Ex-Senior Professor (International Business) & Dean (Research), Asia-Pacific Institute of Management, 3& 4 Institutional Areas, Jasola (Sarita Vihar), New Delhi