A tale of investment, imagination and belief

Transformation time at Hong Kong International Airport

Introduction: Airport Authority Hong Kong has turned the COVID-driven aviation crisis to positive impact though an ongoing and deeply ambitious transformation of its runways, terminals, commercial services and other facilities. The Moodie Davitt Report Chairman Martin Moodie visited Hong Kong International Airport late last month to view the work in progress, meeting with Executive Director, Commercial, Cissy Chan and General Manager Retail Portfolio Alby Tsang. He discovered a mood underpinned by realism but brimming with positivity, as well as plenty of welcome surprises for the travelling consumer of the future.

Walking around Hong Kong International Airport (HKIA) in late April amid a global pandemic is a sobering experience but, unexpectedly, also an uplifting one. Yes, this whole vast airport has an eerie silence, born of a daily average of just 2,000 passengers, less than 1% of that in the same, pre-pandemic month of 2019. Yes, all but some 20 of the 280 shops and restaurants are closed. And, yes, the few passengers that you do see airside are masked and intent on getting the airport experience over with rather than being able to enjoy it. And yet, thanks to an ambitious commitment to the future by Airport Authority Hong Kong (AA), there is a palpable sense of rebirth and of conviction that the worst is over and that better days are coming.

"We believe that when passengers com back, they will have a very refreshing experience with all the new facilities"

Airport Authority Hong Kong Executive Director, Commercial, Cissy Chan

What makes this transformation – and the heavy investment involved – particularly impressive is that it has happened against the backdrop of the toughest and most sustained crisis in the airport’s 23-year history. Passenger traffic fell by -88% year-on-year in 2020 and from the time the COVID-19 pandemic was full-blown in April that year, the decline was never less than -97%. With traffic so seriously reduced, only a smattering of outlets remain open to provide essential services, including food & beverage, pharmacy and money exchange operations in key locations. But it’s what is being developed rather than closed during the crisis that tells the story here. “We believe that when passengers come back, they will have a very refreshing experience with all the new facilities,” says Airport Authority Hong Kong Executive Director, Commercial, Cissy Chan.

‘Park and Visit’ visitors will be able to travel to SKYCITY or to other parts of Hong Kong on Airportcity Link, a new vehicular and pedestrian bridge

From City Airport to Airport City

The projects range from a new third runway to a reimagined Terminal 2; from an enhanced luxury zone anchored by three duplex stores to a fabulous food court; and from the world’s longest air bridge to an impressively chic and hi-tech new look for all the washrooms and toilets. All the projects are underpinned by a common theme, a determination to offer HKIA passengers outstanding facilities and services once travel kicks back into some kind of normality. First, the big picture. As in very big. Some HK$40 billion (US$5.2 billion) is being poured into AA’s Airport City development. The phased ten-year programme (2020-2030) is designed to enhance the airport’s capacity and functionality, while transforming it into a new landmark and propelling the economic development of Hong Kong and the surrounding region. An integral part of the scheme is SKYCITY, a vast project covering some 25 hectares. The development is anchored by a 350,000sq m space called 11 SKIES, which will become Hong Kong’s largest hub for retail, dining, entertainment after opening in phases from 2022. Phase II development of AsiaWorld-Expo (pictured at the top of the page) will house the largest indoor performance venue in Hong Kong, capable of hosting 20,000 people. Upon completion, the total gross floor area of its exhibition facilities will increase to 100,000sq m. There’s more. AA’s development of the Hong Kong Boundary Crossing Facilities (HKBCF) Island of Hong Kong-Zhuhai-Macao Bridge (HZMB) focuses on enhancing HKIA’s services and development as part of the Airport City strategy. As part of that mission, AA will build automated car parks on HKBCF Island to provide around 6,000 parking spaces in phases. The ‘Park and Fly’ and ‘Park and Visit’ carparks will cater to air transfer passengers and visitors respectively. Park and Fly passengers will transfer to HKIA boarding gates directly from the HKBCF restricted area, facilitated by a bonded vehicular bridge connected to the airport’s Sky Pier Terminal, without having to go through immigration procedures in Hong Kong. AA also plans to introduce an autonomous transportation system on the Airportcity Link to connect HKBCF Island and SKYCITY, and extend the system to nearby Tung Chung town centre.

Click on the YouTube icon to view progress on this extraordinary project

Two becomes three as the 3RS is born

To accommodate future air traffic growth, Airport Authority Hong Kong is expanding HKIA into a three-runway system, dubbed the 3RS, which ranks as one of the largest infrastructure projects in Hong Kong’s history. The northern runway will be used for landings and the central one for take-offs, while the southern runway will accommodate both. Construction of the third runway is expected to be completed in 2022, and the entire HK$141.5 billion (US$18.2 billion) 3RS project scheduled to be finished in 2024. As part of the 3RS programme, Terminal 2, currently closed, is being expanded to provide a comprehensive range of terminal services, serving departure, arrival and transfer operations. The new-look facility will comprise an eight-level main building, supplemented by seven- and four-storey annexes. The project, awarded to Gammon Engineering & Construction last August, will culminate in T2 reopening in 2024, when it will rank as one of the world’s greenest air terminals. T2 will feature an extensive (mainly airside) retail programme, offering a wide array of shops, food & beverage offerings and other consumer services. The 3RS will add capacity of 30 million passengers, bringing HKIA’s total capacity to 100 million. While T2 will be a state-of-the-art facility, T1 won’t be left behind, Chan and Tsang promise. “The vision is that Terminal 1 will be just as nice as T2,” says Chan. In line with that notion, a wide-ranging enhancement and modernisation of T1 has been taking place during the low-traffic months of the pandemic. The boarding gates, another fundamental aspect of airport operations, are all being stylishly revamped one by one. E-boarding gates, powered by biometrics and touchless technologies are being introduced, all in tune with the evolving needs and concerns of passengers in the pandemic and post-pandemic age.

The lure of luxury

HKIA’s luxury retail zone, featuring over 40 high-end brands, is the subject of one of the most impressive developments. All the public areas have been extensively and stylishly renovated, highlighted by decorous marble flooring, new ceilings, lightboxes and lighting (pictured below). Excitingly, HKIA’s two new duplex luxury stores, Chanel (relocated to the former Rolex site) and Louis Vuitton (in the former Chanel position) are close to completion with all internal fit-outs done. Both will open in coming months, and Tsang promises the quality of flooring, finishings and ceilings will truly excite. HKIA will soon gain a third luxury duplex when the current Hermès store in the East Hall, Level 6 is extended to level 7. The existing 3,000sq ft store is already one of the airport’s most productive retail zones but has been constrained by lack of space. An internal staircase complemented by a new façade will change all that. The downstairs area will remain the principal shopping focus with the higher level reserved for an exclusive VIP area – a worldwide airport first for the great French luxury brand. The expanded space is expected to open in Q2 2022. AA is also working on a complete revamp of its online shop. The new version, featuring an improved interface, is set to roll out in the third quarter. The authority is also launching a new service, leveraging its online platform to offer a new luxury concierge service. This exclusive service for HKIA’s luxury retail brands is designed to help connect passengers with their sales staff. Customers can ask questions, reserve items, or even place orders before they arrive at the airport.

Chanel has relocated its elegant duplex boutique to the former Rolex site

The beautiful façade of the new Louis Vuitton duplex store was recently installed (replacing possibly the most elegant shop hoarding seen in airport history). The actual store promises to be a spectacular and elegant attraction for Hong Kong International Airport passengers.

A former Cathay Pacific lounge near the former gate 21 (now gate 11) has been converted into an alluring new 250-seat food court.

Bridging the divide

Meanwhile the main structure of the imposing new Sky Bridge was delivered to its final position in January, the culmination of a hugely complex prefabrication phase. At 200m, this is the world’s longest airside bridge, allowing the largest passenger aircraft, the A380, to pass underneath. The facility will connect T1 and the North Satellite Concourse, minimising travelling time between the two buildings as passengers will no longer need to shuttle by buses. The Sky Bridge will also provide outstanding views of the apron, as well as providing two “iconic” food & beverage outlets, according to Alby Tsang. AA has also converted a former Cathay Pacific lounge near the former gate 21 (now gate 11) into an alluring new 250-seat food court. The offering features two fast food offers, one international and one local, both offering a refined and spacious environment and outstanding views of the airport apron.

[Click on the YouTube icon to view dramatic footage of HKIA’s spectacular new Sky Bridge being put in place. To minimise impact on operations, this giant structure was prefabricated in Zhongshan, China. Three precast segments were transported to the assembly yard in HKIA’s midfield area in late 2019. The segments were then assembled to form the main structure of the bridge. On 9 January 2020, the main structure of the bridge, weighing over 5,000 tonnes, was transported over 3km along HKIA’s apron from the assembly yard to the bridge’s final position. It was then erected on the bridge towers a day later.]

Ready for recovery

“I believe the worst is behind us. With vaccinations gaining progress in key markets, we expect demand for air travel will gradually pick up towards the end of the year, and our retail business recovery will follow,” Tsang said during this month’s ACIAPAC Online webinar run by Airports Council International (ACI) Asia-Pacific (see YouTube link below). Tsang noted that HKIA will continue to widen its retail mix “to ensure that we have something appealing to different types of passengers and avoid unhealthy cannibalisation”. He cited the upcoming opening for a debut airside bank, which will offer wealth management services to travellers, and also highlighted the launch of a new retail loyalty programme. “We want to ensure that we are ready when the passengers are back, whether they are the more affluent passengers looking for a luxury offering or budget travellers simply seeking good value.” Airport Authority Hong Kong is ready alright. The past 15 months may have tumultuous but they have certainly not been wasted.

*For more visuals from the planned luxury transformation, including a before and after look at the luxury zone changes, click on the online version of this feature here.

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The Moodie Davitt eZine Issue 296 | 26 May 2021

The Moodie Davitt eZine is published 15 times per year by The Moodie Davitt Report (Moodie International Ltd). © All material is copyright and cannot be reproduced without the permission of the Publisher. To find out more visit www.moodiedavittreport.com and to subscribe, please e-mail sinead@moodiedavittreport.com

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