Hürriyet searched the biggest duty free 25 years deal in the world between airport administrator IGA and Unifree in January 2015. When the new airport has reached its total potential and if the planned targets are also reached, Unifree will pay more than 500 million Euro (1 billion 600 million TL) annually.
The new airport which is world’s seventh biggest airport and being constructed in the north of Istanbul will attract much attention for years not only for its 150 million capacity of passengers and the 77 million square meters area that it covers but also with its magnificent economy that it will create. If everything goes according to the plan, Unifree Duty Free Inc. which won the third airports’ auction will pay an annual hire that will amaze people so deeply.
Hürriyet searched the biggest duty free 25 years deal in the world between airport administrator IGA (Istanbul Grand Airport) Airport Administrator Inc. and Unifree in January 2015.
When the new airport has reached its total potential and if the planned targets are also reached, Unifree will pay more than 500 million Euro (1 billion 600 million TL) annually.
The deal is both the longest global aviation industry’s economic deal and the biggest income contract that has been signed by private sector throughout the republic history.
First of all, I should state that I tried to have a talk with the officers of Unifree and IGA in order to talk about the details of income sharing model agreement. Unifree officials said that they could not give any specific information about any topic. However, in IGA, LIMAK executive board chairman Nihat Özdemir gave me some clues about new airport’s duty free agreement but Nihat Özdemir also stated that he could not give any information on contract’s economic extent.
I had to do the work myself
After seeing that the parties were reluctant to give any information about the deal, I have done a calculation by handling current airport models and the targets per head. The numbers that ı have got shows that Unifree will pay 300 million Euro annually and this hire will continue to increase and become 500 million Euro (todays’ 1, 6 billion TL) annually. Let me Show you how i reached this numbers.
First of all, we should calculate potential duty free customers. The first criteria is that we should consider that the passengers shopping in Duty free are outlines passengers. In 2015, Atatürk airport had 61.3 million passengers. The %67 of these passengers were of outlines and %33 were of domestic lines. When we have a look at the previous years, we will clearly see that external flights passenger’s rate increased consistently. It will not be amusing at all that the rate will reach to 75 when we take airports’ strategies and new airport’s capacity into consideration. When the airport has reached the total potential according to the needs which is 150 million passengers annually, the passengers of %75 will be 112 million external flights passengers.
OF THE %60 IS TRANSITION
So, are all of the passengers belong to duty free? No. We had better point out that % 60 of the external flight passengers are transition passengers, and %40 of the passengers are normal ones. A part of these passengers do shopping in duty free markets. In this situation, we can say that half of the external flights passengers have the capacity to do shopping in duty free. That means almost 56 million passengers will be customers of duty free markets whenever the airport is ready.
What may be the spending per head? According to the current statistics, the spending is 14 euro per head in Atatürk airport. I expect that when we consider the size of duty free area in the new airport, this number can increase to 16 euro and this number will continue to raise consistently and become 20 euro. In this situation, the customers of the new airport will spend 2 euro per head. In this manner, Unifree will catch 1 billion and 120 million endorsement. That is 3, 5 billion TL in today’s money. As for the hire that they will pay…
%45 OF THE ENDORSEMENT IS HIRE
Airport administrators worldwide take hires between the amounts of %40 and %50 from the endorsements. In this manner, I expect a %50 amount in agreement between the parties. However, I based my researches on %45. In this state, %45 of 1 billion 120 million euro equals to 504 million euro. In short, when the airport has reached its total capacity which is 150 million passengers, and duty free customers do 20 euros shopping, Unifree will pay more than 500 million euro to IGA for the hire payment.
As for Unifree, it will earn its money with hiring areas, restaurants and stores to the world’s most important labels.
There is magical mirror and charging basket
The auction was won by IGA investors which are Cengiz, Mapa, Limak, Ko-lin, Kalyon Mutual Group (ogg) by giving the highest request ,22 billion 152 million Euro, throughout the republic history in May 3.
Nihat Özdemir one of the partner of Limak said that the new airport’s construction is going on non-stop with 3 thousand work machines and he said that they think the first plane will be land in February 26 in 2018. Nihat Özdemir didn’t give any information about financial criteria of duty free deal but he gave some clues on how the big shopping center will be. Özdemir pointed out that uni free area will be built like Istanbul Bosporus and 150 million of euros has been spent on.
Özdemir said that duty free area will be built on 70 thousand square meters and will consist of six parts. For example, there will be luxurious stores on the 10 thousand square meters and there will be stores in which Turkish products will be sold on an area of 5 thousand square meters. By this means, Turkish products will be announced to the world. Information areas will extent to 2 thousand square meters, activity and taste stands will be on an area of 8 thousand square meters. He emphasized that over 400 foreign and local luxurious labels meet in the same place.
By the way Özdemir is so excited about the technological concepts that will be used in duty free areas. Özdemir said that new airport duty free places will raise sector standards and define them again. We will present our customers new experiences of shopping places rather than classic and conventional ones. Your shopping baskets will know you. These baskets are also have the ability of making charge and they will remember your last shopping history thanks to its electronic features. Customers will see clocks, sun glasses, accessories, clothing and make up materials on themselves without wearing or using them thanks to the “Magical Mirror”. For our disabled customers there will be private cars and educated sales persons will guide them personally during their shopping.