Greater Dallas Planning Council November 14, 2014

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1 Greater Dallas Planning Council November 14, 2014 GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 John Terrell Vice President, Commercial Development Dallas/Fort Worth International Airport

2 Texas & the Dallas-Fort Worth Population is Large Sources: U.S. Census Bureau, Table 5. Estimates of Population Change for Metropolitan Statistical Areas and Rankings. 2

3 Business Overview Operations GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 A major component of the U.S. aviation infrastructure The central North American location is within 4 hours of any major city in the U.S., Mexico and Canada The world s fourth busiest and fastest growing More than 1,800 flights daily to 200 worldwide destinations Recognized as the best airport in its class for customer service Focal point of the Aerotropolis 3

4 DFW Airport Overview Jointly owned by the cities of Dallas and Fort Worth, DFW Airport has built a huge infrastructure and still has room to grow. 4

5 Host Cities Coppell Euless Irving Grapevine Coppell Grapevine Irving Euless 5

6 DFW: Connecting The World Commercial Development opportunities play a key role in DFW s future $36.6 million in revenues for fiscal year

7 DFW Land Use Plan Supports goal to be more competitive in the global travel market by developing a multifaceted center of commerce. Approximately 6,600 acres of developable land More than 5,200 gross acres of property will emerge into multiple centers of development Strategic location between Dallas and Fort Worth and proximity to a network of highways provide commercial developers with numerous key advantages 7

8 DFW Land Use Plan Core Business Operations GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 RUNWAYS AVIATION MAINTENANCE FACILITIES 12,000 acres maintained for core business operations TAXIWAYS CARGO DEVELOPMENT AVIATION RELATED USES 8

9 International Commerce Park GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 Developable Land Area 432 acres DFW Investment $37M Developer Improvement $247M Jobs 3,219 Salaries $131M Annual Revenue to DFW Airport

10 Commercial Development Aviall, Inc. at International Commerce Park (ICP) GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 EXPANSION Grown Largest its independent BENEFITS business exponentially: provider of new aviation parts and related aftermarket services Increase Wholly Increasing owned its taxable subsidiary sales business from of $506 The personal Boeing million property in Company 2001 value to $3.22 between billion $25.5 in 2010 million and $60 million Relocated Facility to expansion ICP in November from 239, square feet to 564,000 square feet, with 630,800 Increase Freeport inventory value between $225 million and $580 million 245,000 square square feet foot of additional corporate space headquarters and global distribution center Additional $20.6 million payroll annually The move Employees to ICP increased doubled the from size 340 of to its 800, previous adding space an additional 300 jobs Between 200 and 500 hotel room nights annually 10

11 Commercial Development Dallas Cowboys Merchandising at International Commerce Park 11

12 Commercial Development Initiatives Southgate Plaza GREATER DALLAS PLANNING COUNCIL NOVEMBER 14,

13 Commercial Development Initiatives Southgate Plaza GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 Retail, Restaurant, Hotel, and Office Modern architecture and sustainable design Vertically dense and walk-able Rental Car Facility proximity Integrated Flight Information Display System (FIDS) 13

14 Southgate Plaza Hyatt Place Conceptual Images GREATER DALLAS PLANNING COUNCIL NOVEMBER 14,

15 DFW as an Airport City Types of development Hotels GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 Hyatt Regency DFW Adjacent to Terminal C Grand Hyatt DFW Inside International Terminal D 15

16 Paradise 4 Paws High end dog and cat resort and daycare facility. GREATER DALLAS PLANNING COUNCIL NOVEMBER 14,

17 Commercial Development Initiatives Grapevine 1100 Acres Economic Analysis GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 Transform DFW Airport from a facilitator to a driver of regional tourism The 1100 Acres Themed Destination 17

18 Commercial Development Initiatives Founders Plaza Center adjacent to the Airport Observation Area Southern termination of Texan Trail enhanced corridor Viable development opportunity with approximately 200,000 vehicles per day Mixed Use envisioned as Freeway Commercial Hospitality, Entertainment, Retail and Themed developments Educational, Office and Industrial 18

19 Commercial Development Initiatives Founders Plaza Center Site Concept and Renderings GREATER DALLAS PLANNING COUNCIL NOVEMBER 14,

20 Commercial Development Initiatives Passport Park GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 Southern DFW Gateway Mixed use development Convenient Access to SH 183 Highly Visible from SH ,000± Square Feet Retail Office and Warehouse components 20

21 Approximately 1,800 acres on the south west side of the Airport Two 18-hole championship golf courses Premier opportunity for corporate campus office Abundant green space and surrounding water features 21

22 Terminals A, B, C and E Re-life 30 year investment 60-70% required to replace aging infrastructure and meet DFW core obligations Address Regulatory and Code requirements Improved Ticketing, Security Checkpoints, and Baggage Handling systems to enhance operational efficiencies New vertical core with high capacity elevators Curbside enhancements could include: New entry canopy Cover pedestrian crossing at main entrances Signage Garage refurbishment at Terminals B, C and E Garage replacement at Terminal A 22

23 5 levels Roughly 7,700 parking spaced Counting System Elevators 3 million square feet Improved lighting and signage New Roadway system ADA accessible on most levels Emergency Call Boxes 23

24 Reconfigure ticketing areas Incorporate new selfservice technologies Provide premium check-in Increase passenger flows Create sense of place Increase natural light Consolidate and expand checkpoint Incorporate TSA future technology requirements Rolling out improved technology to improve passenger flow Systems back-up support 24

25 Part of DART s Orange I-3 Line Station is located between International Parkway and the Northbound Service Road adjacent to Terminal A Began operational service in August 2014 Similar TexRail station is located adjacent to Terminal B 25

26 DFW as an Airport City Mass-transit rail service is now operating at DFW s terminal area to optimize connectivity. DFW AIRPORT A/B STATION 26

27 DFW as an Airport City In 2006, DFW signed an historic agreement with Chesapeake Energy Corporation to drill for natural gas on its 18,000 acre-property.

28 The Future of DFW Airport Five major highways converge at the Airport, making it one of the mosttraveled sectors in the Metroplex. Two major roadways projects are underway near the Airport The DFW Connector and the North Tarrant Express projects. 28

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30 Tax Sharing Agreements History GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 Since 1999, DFW has successfully achieved tax-sharing arrangements as a result of inter-local agreements and legislation collaboration with the Owner Cities. The Cities of Dallas and Fort Worth and the Board agree that as a result of this Agreement, development opportunities within the Property which are consistent with the development policies of the Board, shall be encouraged. Benefits Generates tax revenues for the Owner Cities Increases economic development and creates job opportunities Provides an equitable distribution of tax revenues (Dallas, Fort Worth and the host city) Quote Source: Interlocal Agreement 30

31 Business Model Analysis Tax Sharing Arrangements GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 Euless Tax Share Agreement Coppell Irving Tax Share Agreement Grapevine legislative tax-sharing arrangement Grapevine Irving Coppell Tax Share Agreement Euless Total annual tax contribution to taxing entities +/- $63,000,000 31

32 Business Model Analysis Development Districts Map

33 Revenues To: Total Stabilized Annual Cash Flow (2038) 1 Total Cumulative Revenues NPV of Revenues at 8% DFW $261,315,703 $15,431,436,527 $2,268,021,502 Revenues To: Total Stabilized Annual Cash Flow (2038) 1 Total Cumulative Revenues NPV of Revenues at 8% Fort Worth $40,355,493 $1,927,528,913 $376,916,759 Dallas $64,922,557 $3,190,144,169 $599,570,167 All Other Taxing Entities $411,743,765 $19,136,862,314 $3,713,842,881 TOTAL REVENUES $778,337,517 $39,685,971,924 $6,958,351,308

34 International Economic Development Council (IEDC) 2013 Investment Attraction Strategy GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 Target Industry Study Market Trends Site Selection Factors Sector Targets Targeted Geography Direct Air Routes Growth Rates U.S. Investment Trends Logistics / Synergies Communication / Collaboration Owner Cities Regional / Economic Developers Regional Businesses Universities

35 International Economic Development Council (IEDC) 2013 Conclusions of Study GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 It will be critical for DFW Airport and the Dallas-Fort Worth region to approach strong industry/sector and geographic targets identified in Study DFW Airport should play a strong leadership role as it has natural relationships, synergistic business objectives and prime assets DFW Airport and its Owner Cities should jointly communicate the benefits of the region and airport

36 Economic, Fiscal and Developmental Impacts GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 Detailed examination of impacts from: Airport Operations Commercial Airlines Operations Concession Sales Impacts Visitor Spending Business Activities of Airport Tenants Regional Business Impacts of Air Cargo Total Economic and Fiscal Impacts of Recurring Operations Future Development of Airport Land

37 Headquarter Relocations to DFW

38 Annual Economic Impact $31.6 Billion Jobs Supported 143,000 Annual Supported Payroll $9.4 Billion

39 DFW Global Business Ventures International Airport Partnerships Foreign Trade Zone Program International Trade Alliances 39

40 International Airport Partnerships DFW Airport seeks to gain best practices through information sharing, collaboration, and working relationships with airports around the world. Airport Management/Operations Customer Service Sustainability Route Development Marketing Opportunities International Awareness 40

41 International Airport Partnerships Shanghai Airport Authority (China) Oct Taoyuan International Airport (Taiwan) Dec Seoul Incheon International Airport (S. Korea) Sep Singapore Changi Airport Group (Singapore) Sep Beijing Capital International Airport (China) Sep Moroccan Airports Authority (Morocco) Oct

42 International Airport Partnerships Friendship Cooperatives, Sister Airport Alliances, Partnerships, MOUs To boost global awareness of each airport, and produce opportunities for passenger and cargo service To enhance cooperation, share knowledge, and improve practices To share best practices in customer service, operations, safety, technology, air service development, sustainability, amenities, etc. To promote marketing cooperative opportunities To exchange expertise in areas of firefighting, rescue and evacuation operations, to ensure operational and safety excellence 42

43 International Airport Partnerships DFW Fire Training Research Center a World-Class Fire Training Program 43

44 Foreign Trade Zone Program DFW s On-Airport FTZ GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, ,400 acres/971 hectares on-airport Pre-designated as FTZ Companies can simply activate with Customs 45 buildings, 10 million sq. ft. of warehouse space is FTZ-designated New industrial development underway FTZ acreage can easily be moved to accommodate companies Note: DFW serves as Grantee of FTZ No. 39 serving Port of Dallas/Fort Worth 44

45 Foreign Trade Zone Program Physically located within U.S., but treated as outside U.S. Customs territory enabling U.S. firms to successfully compete with foreign counterparts Economic Benefits: No duty on imports until they leave FTZ for domestic destination No duty on items brought into FTZ and exported (these items never enter Customs territory) Manufacturing FTZs can elect lower duty rate component part or finished product No state and local personal property tax Imported inventory, or Domestic inventory held for export Other logistical and process savings 45

46 International Trade Alliances Free Trade Zone Alliances Dubai Airport Freezone Authority (UAE) Mar Farglory Free Trade Zone (Taiwan) May

47 International Trade Alliances Free Trade Zone Alliances GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 To expand trade and business through effective, collaborative and innovative approach to free trade zone management To exchange expertise to benefit business and develop new opportunities in the global markets To support existing and future air service between countries To share best practices, participate in joint marketing opportunities 47

48 International Trade Alliances Trade Alliance with Aeropuerto Internacional de Monterrey (OMA MTY) Agreement signed on February 27, 2014 Purpose: To increase air cargo flow between the airports, around the world OMA comprises thirteen airports, of which Monterrey is the largest Strategic location industrial heartland of Mexico Creates opportunities for increased cargo traffic between Central and South America and Asia through DFW Capitalize on synergies resulting from air and truck service between DFW and Monterrey Stimulate commercial development opportunities by identifying new developers and companies with cargo needs 48

49 Commercial Development Website: Translated into 80 Languages 49

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51 Greater Dallas Planning Council November 14, 2014 GREATER DALLAS PLANNING COUNCIL NOVEMBER 14, 2014 John Terrell Vice President, Commercial Development Dallas/Fort Worth International Airport