P170.6-B Naia rehab project attracts 4 bidders

Transportation Secretary Jaime Bautista (File photo from the Facebook page of the Department of Transportation)

MANILA, Philippines – The government is a step closer to rehabilitating the aging and congested Ninoy Aquino International Airport (Naia) after attracting four private sector bidders for the main gateway’s P170.6-billion operations and maintenance contract.

On Wednesday, the last day of submission of bids for the project, the Department of Transportation (DOTr) accepted the offers of the Manila International Airport Consortium (Miac), Asian Airport Consortium, GMR Airports Consortium, and SMC SAP & Co. Consortium.

“This is a very important project of the government as we want all our passengers to improve their travel experience. We’re happy that you all participated in this very important project,” Transportation Secretary Jaime Bautista said during the opening of bids.

After a completeness check of the documents, the DOTr will further scrutinize the technical and financial qualifications of the bidders and it hopes to award the contract to the concessionaire with the best proposal by the first quarter of 2024. Among the bidder qualifications is a P20-billion equity requirement.

The Naia upgrade project will include the rehabilitation of passenger terminals and airside facilities, such as runway, aircraft parking area, and airfield lighting, and the provision of facilities that will enable intermodal transfers at the terminal.

The winning private sector partner will have a 15-year concession period to implement the project, which can be extended by 10 years if needed.

Included in the contract is an upfront payment of P30 billion to the Manila International Airport Authority (Miaa) which will receive from the chosen private partner an annual fixed payment of P2 billion during the concession period.

The government will also have a share in Naia’s revenue generation from commercial and noncommercial operations.

Local tycoons, foreign partners

Miac is composed of Aboitiz InfraCapital Inc., AC Infrastructure Holdings Corp. of the Ayalas, Asia’s Emerging Dragon Corp., Alliance Global-Infracorp Development Inc. of tycoon Andrew Tan, Filinvest Development Corp. of the Gotianun family, JG Summit Infrastructure Holdings Corp. of the Gokongweis and Global Infrastructure Partners.

The Asian Airport Consortium is led by Asian Infrastructure and Management Corp., a construction firm based in Taguig City. Other members include diversified conglomerate Cosco Capital Inc.; logistics company Philippine Skylanders International Inc., and Indonesian airport operator PT Angkasa Pura II.

The members of the GMR Airports Consortium have been involved in airport development and management. GMR Airports International BV is part of the group operating the Mactan-Cebu International Airport while House of Investments Inc. of the Yuchengco family and Cavitex Holdings are members of the consortium that bagged the $11-billion Sangley Point International Airport project.

Billionaire Ramon Ang’s San Miguel Holdings Corp., which is also developing the New Manila International Airport in Bulacan, is the lead member of the SMC SAP & Co. Consortium.

Other members of the consortium are local companies RLW Aviation Development Inc. and RMM Asian Logistics Inc., and Korean airport operator Incheon International Airport Corp., which previously bought bidding documents on its own.

Decongesting Naia

Bautista stressed the need to implement upgrades at the country’s main international gateway, which has been seeing heavier passenger traffic with the resurgence of air travel.

“This airport is very congested, with a capacity of only 32 million but handling almost 50 million passengers,” he said.

The airport has been receiving complaints from passengers due to operational inefficiencies, including long queues at immigration and lack of transportation in and out of the terminals. A tourism blog even named Naia as one of the “most stressful airports” in Asia (excluding Middle East and Central Asia).

Early this year, Naia also dealt with power outages that inconvenienced passengers.

This is not the first time the government launched the Naia rehabilitation project.

Megawide Construction Corp. and its partner GMR had earlier received the original proponent status, but this was revoked by the Miaa in December 2020 for unclear reasons.

Last April, Miac submitted a P267-billion unsolicited bid to improve the facilities of Naia, but the DOTr decided later on to proceed via the solicited bidding process to give it the upper hand in choosing the private sector partner to take on the massive infrastructure project.

In solicited bids, the government invites companies to look into a project through parameters it will provide, including the cost and ways by which an infrastructure will have to be operated. Unsolicited proposals, meanwhile, are initiated by private sector proponents.