TRBUSINESS NEW TERRACE
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1 QAIA handled more than 6.5m passengers (+5.5%) in the first nine months of Airport International Group is preparing to launch a significant speciality retail tender at Jordan s Queen Alia International Airport (QAIA) in January to dovetail with substantial renovations to its commercial footprint. QAIA expects to attract interest from big speciality retail operators for lots covering 800sq m between departures and arrivals, as a number of existing contracts expire, TRBusiness has learned. Details of the tender are still being worked through, but it understood attention will shift to the bids once work concludes on its F&B tender and facelifted Dufry duty free departure store by March/April. Today we have WHSmith, a big player in Arabic sweets, a large chain of pharmacies and spa & massage all of these categories will be up for one big tender, said Deema Anani, Chief Commercial Officer, Airport International Group. NEW TERRACE In addition to the 800sq m, QAIA is planning to dedicate space to retail, F&B and speciality retail at a new 5,000sq m terrace located above the baggage handling building on level three of departures. Under current plans, a minimum of 300sq m is allocated to F&B as part of the master concessionaire tender. However, that could increase should the airport receive proposals to leverage the space before the winning bid is announced around March. Deema Anani, Chief Commercial Officer, Airport International Group. This is for 5,000sq m; if you want to propose concepts for speciality retail, there will be a minimum of 300sq m [dedicated to F&B], confirmed Anani. This is in addition to the 800sq m [of speciality retail]. Once we re done, we are going to develop the whole terrace concept with entertainment and children s areas we have a vision to develop the terrace. First, we re plugging in the concessionaires.
2 By January, the airport would have received the F&B tenders and would then know how much F&B space for the terrace would be allocated to the winning vendor. For the uninitiated, Airport International Group won a 25-year Build-Operate-Transfer (BOT) concession for the new state-of-the-art QAIA in Amman, which began operation in Groupe ADP retains a controlling stake in the airport having agreed a contract in As Jordan s primary international gateway, QAIA moved to expand its pax capacity to 12m in 2016 up from seven million and hopes to reach almost 16.5m by An artist s impression of the new 5,000sq m terrace, which will boast retail, speciality retail and F&B zones when it opens in This year, the operator has embarked on an entire overhaul of its commercial facilities, including the aforementioned F&B tender, in part to trap rising spends from the low-cost carrier segment. We are one of the few airports where dwell time is around three hours so there is enough time for people to shop and dine and we want to be able to make sure we offer them something extremely unique, commented Anani. ARRIVALS SPP BOOST Last month, Dufry inaugurated its enlarged arrivals shop (600sq m) by converting two existing customs exits into one as the travel retailer responds to heightened demand for duty free destination products.
3 Dufry has increased the size of its arrivals store by 235sq m to total 625sq m as it eyes a 15% lift in spend per passenger. We have been monitoring the performance of duty free arrivals and it has significantly grown over the years, commented Amani. There is a strong trust in the quality of the products; duty free arrivals has become a destination for travellers and Jordanian residents, including the Syrian and Iraqi base that lives in Jordan, so we wanted to increase the area. Anani reveals the new space expects to achieve an increase in spend per passenger of nearly 15% through a remixed category mix placing a greater focus on gifting, plus an expanded areas for perfumes & cosmetics and reserve and collect. Next year, the plan is to flesh out the spread by adding accessories, sunglasses and potentially electronics, aside the usual assortment. Meanwhile, planned upgrades at Dufry s walkthrough departures shop to transform it into a New Generation store will eventually result in an additional 300sq m of floorspace to total 2,800sq m. This is tipped to complete by April latest next year. You ll see a lot of focus on digital we are a destination airport, so people leaving Jordan want to have a flavour before they go, continued Anani.
4 The changing passenger dynamic presents new challenges and opportunities for QAIA. We are working on having Dead Sea products, Arabic sweets, dates, olive oil all the local elements will be further accentuated in the new shop to improve the customer experience and increase dwell time. Duty free is our largest contributor in terms of non-aeronautical revenue; We have a very interesting and specific dynamic in Jordan relating to duty free. It s our role as an airport authority to make sure we introduce that sense of place by doing things the right way. RETAIL REVENUE +13% IN H1 Commercial revenues have been in rude health this year, despite the flurry of re-configuration activity. In the first half of 2018, we have seen 16% growth year-to-year in non-aeronautical revenues and that has been mainly retail and food & beverage, revealed Anani. Broken down, retail and F&B has grown by approximately 13% and 17%, respectively, outstripping a lift of almost 8% in passenger traffic during the same period. A key interlocutor to the healthy commercial returns is a greater onus on Jordanian customers. Almost 40% of our passengers are Jordanians, explains Amani. These are either typical business or frequent flyers but also a large number of Jordanians living outside Jordan whether in the Gulf, Saudi Arabia, Dubai, or students studying abroad.
5 Renovations to Dufry s walkthrough store should conclude by the end of April. The close proximity of GCC territories means frequent travel to the country is a common occurrence, however, Amani points out that the economic situation in the region notably in Syria and Iraq has meant disposable incomes have suffered. We ve seen less travel from the Jordanians they are not doing three trips a year, but one or two, hence we felt the need to diversify the profile of our passengers, adds Amani. As a result, QAIA has begun to collaborate with the Jordan Tourism Board to spike interest in group travel and has begun targeting low-cost carrier traffic in a tie-up with Ryanair on a Pathos (Cyprus) to Jordan route from April. At the end of October we increased that from one to ten destinations coming from Europe to Jordan. There is also a lot of appeal from Russian tourists; we work with Nordwind (LCC) from Moscow to bring in low cost tourists to Jordan, concludes Anani. We are not a transit hub; Jordan is a destination so we are targeting point-to-point travel, customers who visit Petra, the Dead Sea and all the attractions the country has to offer. For a more detailed analysis of the Middle Eastern duty free and travel retail landscape, watch out for the December issue of TRBusiness, available soon. Click here to subscribe.
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