MegaProject 407: EBRD finances expansion of Turkey's Dalaman airport
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The European Bank for Reconstruction and Development (EBRD) has provided financing for the Dalaman airport concession in south-western Turkish province of Mu?la.
The Bank is lending €175 million to YDA Havalimani Yapim ve Isletme A.S., a special-purpose vehicle set up by the Turkish construction and infrastructure company YDA Insaat, which was awarded the concession contract last year. YDA Insaat offered the highest bid, €705 million (US$800 million), for the 26-year contract.
The EBRD financing is composed of a 16-year A-loan of €87.5 million for the Bank's own account and a 15-year B-loan €87.5 million syndicated to UniCredit Bank Austria.
The funds will be used to build a new energy-efficient and environmentally friendly domestic terminal with auxiliary structures including road access and parking facilities. The project will accommodate the strong growth in domestic and international traffic at Dalaman airport.
With the new terminal, the domestic passenger capacity of Dalaman airport will increase to 10 million from the current 3 million passengers per year, giving a significant boost to the tourism industry.
Dalaman airport, which serves the popular Turkish holiday resorts of Datça, Marmaris, Göcek, Dalyan, Sar?germe, Fethiye, Ölüdeniz, Kalkan and Ka?, is the fourth largest airport in terms of passenger traffic on international flights and the seventh largest airport in terms of total passenger traffic in Turkey. The airport's passenger traffic rose 6% to 4.057 million in 2013.
Sue Barrett, EBRD Director for Transport, commented:
"We are pleased to support greater private-sector participation in transport infrastructure projects which improve people's lives and strengthen important sectors of the Turkish economy. Dalaman is the first regional airport that the EBRD is financing and we expect other regional airports to be operating under successful PPP schemes in future."
Both the international and the new domestic terminal will be run by YDA Havalimani Yapim ve Isletme A.S. under a concession agreement until the end of 2040.
Hüseyin Arslan, Chairman of YDA Group, stated:
"We are very proud of our contribution to the economic development of the region by operating Dalaman Airport. We are making a huge investment worth €1 billion and will transform the airport and the travel experience of passengers. I express my sincere gratitude to the EBRD and UniCredit for their confidence in our Group and in Turkey as we embark on this large-scale investment."
YDA Group has been operating Dalaman International Airport since 2006. Its experience in the aviation sector also includes the operation of Kazakhstan's Aktau airport, the construction of Boryspil International Airport in the Ukrainian capital Kiev and the Turkish Airlines Aviation Maintenance and Overhaul Centre at Istanbul's Sabiha Gökçen Airport, the region's largest aviation maintenance hub.
The EBRD previously invested in YDA Insaat's lira-denominated bond issue to support the company's operations under recently awarded PPP projects in Turkey.
During the last two weeks we have reported about several airport PPP projects globally: