In 2013, through the U.S. Federal Aviation Administration (FAA) Airport Investment Partnership Program, Puerto Rico entered into a public-private partnership for the long-term concession to finance, operate, maintain and improve the Luis Muñoz Marín International Airport (LMM), located in Carolina, Puerto Rico, just three miles from the capital city of San Juan.
Entering into a 40-year lease with the venture company Aerostar, Puerto Rico received $615 million in an upfront leasehold fee, and an annual payment of $2.5 million for the first five years of the agreement, along with 5 percent of revenue over the next 25 years and 10 percent of revenue for the final ten years. The company Aerostar is a joint venture between PSP Investments, one of Canada’s largest pension investments managers, and Grupo Aeroportuario del Sureste, a Mexican airport management firm. Aerostar modernized the facilities at LMM with an upfront investment of roughly $400 million, renovated terminals, automated baggage scanning, and retail stores. Recently, Aerostar announced an additional $200 million, 5-year improvement and expansion plan, including runway reconstruction, structural repairs from damage caused by Hurricane Maria, and terminal renovations.
Today, LMM handles more than 8 million passengers per year and is served by in excess of 15 different airlines. LMM is the largest airport in Puerto Rico and serves as the island’s primary international gateway and connection to the rest of the region, primarily the continental United States.
Building off of the success of the LMM International Airport, the Puerto Rico P3 Authority has developed a list of over 20 projects in 2017 and moved a sub-segment of these projects through a detailed screening process. The identification of project candidates together with the successful approval of legislative enhancements that introduced unsolicited proposals, has allowed the P3 Authority to formulate a pipeline of potential P3 projects.
The most recent demand projections estimate that by 2024 traffic at the Luis Muñoz Marín International Airport will be at 17.9 million passengers.
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