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Airports Limited, a subsidiary of GMR Infrastructure Ltd, has announced that it has been selected to Develop, Operate and Manage the New International Airport of Heraklion at Crete in partnership with Greek infrastructure major GEK Terna Group. GMR Airports Limited will be the designated Airport Operator in the consortium for this project.

As we reported in late April, GMR submitted along with its partner GEK Terna Group a bid of €480 million (US$539 million) for the construction and operation of the new airport project in Heraklion.

This bid was nearly half that the expected €850 million (US$941 million). As we reported in early July, the government of Greece extended the deadline to bid for the project. Previously, in February the deadline was already postponed.

The scope of the project involves Design, Construction, Financing, Operation, and Maintenance & Exploitation of the airport. The concession period for the greenfield project will be 35 years including Phase 1 Construction of 5 years.

Commenting on the development, Mr Srinivas Bommidala, Business Chairman, GMR Airports said:

“We are excited about the project and the opportunity to partner with GEK Terna in Greece. This new airport will definitely boost the tourism industry and aid the growth of international tourists that Greece has been witnessing over the past couple of years. The airport is in line with the asset lite strategy we have adopted for overseas expansion and will see GMR participate in project management and commercial management in addition to airport operations.”

Mr Sidharath Kapur, President, GMR Airports Limited added:

“This selection reinforces the position of GMR Airports as a major global airport operator. This will be GMR Group’s second foray into Europe after having developed Istanbul’s Sabiha Gokcen airport. Having been selected, we expect to complete necessary documentation and concession signing over the next few months.”

Greece is a major International tourist destination, with 24 Mn tourists per annum. Crete is the largest and the most visited island in Greece. Heraklion Airport, located in Crete, is the 2nd largest in Greece and has witnessed steady traffic growth in the last 3-4 years. The existing Heraklion Airport is handling over 6 million passengers annually and is facing capacity constraint. The new Kastelli Airport, once completed, will replace Heraklion airport.