Doncaster optimistic on SYAC lease deal
The council is hopeful that Peel, which closed Doncaster Sheffield Airport in 2022, is ready to enter into a long-term lease that will allow a reopening at the heart of a South Yorkshire Airport City project.
An extraordinary meeting of Doncaster Council’s cabinet will next week consider progress made on the efforts to take control of the airport site’s future.
Taking to social media this week, Ros Jones, mayor of Doncaster, said: “Saving the airport is critically important for Doncaster & South Yorkshire. I know the amount of support there is in our city and across the region. I am hopeful that I will soon be able to share some good news about a lease agreement for the site.”
Doncaster is working with a number of advisors as it looks to take a lead on bringing back the airport for the South Yorkshire region. These include EY, Jacobs, CBRE and Northpoint Aviation Advisors.
The council is emboldened by a financial viability assessment, which suggested that reopening the airport could bring a net benefit to the region of £800,000 to £1.5bn over 30 years, and could be profit-making inside five years.
So far this year, the local authority has moved to stymie non-related development at the site with a planning condition, and also pushed forward a plan to use compulsory purchase powers if a deal with Peel cannot be reached – South Yorkshire Mayoral Combined Authority stumping up £3.1m in June to support Doncaster.
Property and land giant Peel’s preference, post-closure, was to bring the site fully into its 1,600-acre Gateway East project.
The report updates Doncaster’s cabinet on progress, and seeks delegated approval for the director of resources to enter into a head lease with Peel should negotiations continue to progress well.
Peel has made it clear that a freehold sale is not an option, but the long-term leasehold option is now Doncaster’s preferred course.
According to the report, the council “has held a series of meetings with the current DSA owners on the content and parameters of a lease. The current landowners are considering our SYAC prospectus and proposals. It is envisaged for the content of this report that the current landowners will support the decision to enter into a lease agreement with CDC (City of Doncaster Council)”.
The proposed leasehold site is based on the DSA site and the land allocation intended for airside employment and operational uses.
Doncaster is looking at funding options and presents proposals to de-risk the project sufficiently to secure an airport operator, subject to satisfactory outcome of the procurement exercise and further decision making that would be required to commit any funding.
The project will be expensive, as noted in the report: “Given the historical trading position of DSA and the significant operating risks associated with re-opening the airport, it is unlikely that external debt financing will be accessible to any private investor. Therefore, the re-opening of the airport will require significant investment to support the up-front capital.”
Building on the work of EY, Jacobs UK was commissioned to put together the strategic outline business case for the airport, and this report seeks sign-off to continue this work to outline business case stage.
Aviation masterplan specialist Northpoint Aviation Advisors was brought on board to assist Doncaster in understanding the potential growth opportunities the airport presents. Market engagement exercises have been held, and 10 organisations have expressed an interest in running the airport.
Market feedback suggests that any operator will want a commitment from Doncaster to investment in reinstatement costs for the mothballed airport, along with a rent-free start-up period and the continued support of the council allied with the freedom to modify and develop the site without excessive constraints.
In a suggested timeline, shortlisted bidders could be issued with invitations to tender in November this year, with a deadline of January 2024, and negotiations taking place next spring.
A further transport improvement that could be pursued if the airport is reopened, but is unlikely to progress if not, is the opening of a railway station at the site.
The cabinet meets on 20 September to consider the report.