A new airport.... South Yorkshire Airport City?

Doncaster Sheffield Airport Strategic Review Announcement​

Forums4airports discusses the latest press release from Doncaster Sheffield airport where the airport questions the future of the airport. The owners of the airport, the Peel Group have announced they are looking at their options as the group has decided the airport is no longer viable as an operational airport. Here's the press release:

"The Board of Doncaster Sheffield Airport (DSA) has begun a review of strategic options for the Airport. This review follows lengthy deliberations by the Board of DSA which has reluctantly concluded that aviation activity on the site may no longer be commercially viable.

DSA’s owner, the Peel Group, as the Airport’s principal funder, has reviewed the conclusions of the Board of DSA and commissioned external independent advice in order to evaluate and test the conclusions drawn, which concurs with the Board’s initial findings.

Since the Peel Group acquired the Airport site in 1999 and converted it into an international commercial airport, which opened in 2005, significant amounts have been invested in the terminal, the airfield and its operations, both in relation to the original conversion and subsequently to improve the facilities and infrastructure on offer to create an award winning airport.

However, despite growth in passenger numbers, DSA has never achieved the critical mass required to become profitable and this fundamental issue of a shortfall in passenger numbers is exacerbated by the announcement on 10 June 2022 of the unilateral withdrawal of the Wizz Air based aircraft, leaving the Airport with only one base carrier, namely TUI.

This challenge has been increased by other changes in the aviation market, the well-publicised impact of the COVID-19 pandemic and increasingly important environmental considerations. It has therefore been concluded that aviation activity may no longer be the use for the site which delivers the maximum economic and environmental benefit to the region. Against this backdrop, DSA and the Peel Group, will initiate a consultation and engagement programme with stakeholders on the future of the site and how best to maximise and capitalise on future economic growth opportunities for Doncaster and the wider Sheffield City Region.

The wider Peel Group is already delivering significant development and business opportunities on its adjoining GatewayEast development including the recent deal for over 400,000 sq ft logistics and advanced manufacturing development on site, creating hundreds of new jobs and delivering further economic investment in the region.

Robert Hough, Chairman of Peel Airports Group, which includes Doncaster Sheffield Airport, said: “It is a critical time for aviation globally. Despite pandemic related travel restrictions slowly drawing to a close, we are still facing ongoing obstacles and dynamic long-term threats to the future of the aviation industry. The actions by Wizz to sacrifice its base at Doncaster to shore up its business opportunities at other bases in the South of England are a significant blow for the Airport.

Now is the right time to review how DSA can best create future growth opportunities for Doncaster and for South Yorkshire. The Peel Group remains committed to delivering economic growth, job opportunities and prosperity for Doncaster and the wider region.”

DSA and the Peel Group pride themselves on being forward-thinking whilst prioritising the welfare of staff and customers alike. As such, no further public comments will be made whilst they undertake this engagement period with all stakeholders.
During the Strategic Review, the Airport will operate as normal. Therefore passengers who are due to travel to the airport, please arrive and check in as normal. If there are any disruptions with your flight, you will be contacted by your airline in good time.
For all press enquiries, please contact Charlotte Leach at [email protected]."

"Not great news for DSA or the region"

Should the government or local council foot the bill and provide a financial subsidy to keep the airport open, thoughts...?

 

Im afraid realism seems to be in short supply among the politicians of South Yorkshire. They seem to demonstrate that every time they say anything!

The usually credible source on PPrune has confirmed that talks have not progressed. Has been a reliable source so far.

 

I am convinced this is no more than political posturing. After all Thursday 4th May is getting ever closer. Sure things will be even quieter from Friday 5th onwards!

 

The usually credible source on PPrune has confirmed that talks have not progressed. Has been a reliable source so far.

Yes saw that. 'Game over' was the phrase used.

 

I am convinced this is no more than political posturing. After all Thursday 4th May is getting ever closer. Sure things will be even quieter from Friday 5th onwards!

Have to have some sympathy for Ros Jones, it is their job to be overwhelmingly positive about Doncaster so it must be quite tricky to actually have to show support for something that is quite clearly unviable and which goes completely against public opinion. I do think they are taking the CPO route seriously but it ms high costs and high risk of finding in Peels favour is a fact that will need confronting at some point.

I don’t think the talks with UAE consortium were ever particularly serious, they probably weren’t in a position initially to assess viability. We also know Peel weren’t interested in selling (though every man has his price!) and that there is no way Peel would sell at a cut down price when they’ve sunk significant capital and ongoing financial support into the place. I suspect an NDA was slapped on the interested party(ies) to allow Peel to quietly continue running the site down and asset stripping.

Like you say, things will get quieter towards May. Notice there has been silence from Save DSA in the last 24 hours or so.

 

Like you say, things will get quieter towards May. Notice there has been silence from Save DSA in the last 24 hours or so.

Yet still see people say the airport can be successful with the odd few diversions even though not many diverted to DSA when it was open

 

Yet still see people say the airport can be successful with the odd few diversions even though not many diverted to DSA when it was open

To be fair, there are a lot of people getting interested in the topic that may have been ambivalent to it all before. We know weather diversions are an occupational hazard and that there are operational reasons for aircraft diverting to other airports where their airline has a base. This point is missed by those seemingly mindlessly posting about the snow recently for example which closed MAN but DSA didn’t have any. It’s also a problem when you have an echo chamber who’s rules state no pessimism permitted..

People are being fed incorrect information and are allowing pride and confirmation bias to slant their understanding.

 

This point is missed by those seemingly mindlessly posting about the snow recently for example which closed MAN but DSA didn’t have any. It’s also a problem when you have an echo chamber who’s rules state no pessimism permitted..

This was the example I was thinking of.

 

What the politicians seem to ignore, is that an airport can be either operated by them (the Local Authorities) or by the private sector. The latter means the LAs usually don't have to spend anything in the airport, yet benefit from it. The owners, hopefully, make money and everyone is happy (the green opposition apart). If the owners don't make money, then there's the risk of the airport closing if it's not viable as at DSA. Experts forecast before it even opened that it would fail, yet undeterred, Peel poured millions into it and made nothing. They gave it a good try.

Now, the politicians are starting an enquiry into what went wrong and how the regional assets can be protected. Well the answer is operate the airport yourself I guess! Then it's entirely in the LAs hands whether the airport succeeds or fails. Whether to close it or continue operating at a loss. They can't have their cake and eat it. The very fact that they were being approached by Peel for handouts should have been a warning to them that this was on the cards. They could have offered to buy DSA in the past or put significant money in and taken part ownership ensuring they had a say in its running, but I don't think they ever did.

The reality is that there are various other airports where this could happen. DSA may be the tip of the iceberg. A warning to other LAs with airports locally that success is not guaranteed, and that airports need help, not constant hindrance which might eventually lead to closure. South Yorkshire didn't hinder DSA in the way that LBA has been hindered over many years, yet the outcome was bad anyway. Perhaps they should all have listened to those aviation experts at the Public Inquiry into DSA who pointed to the other 4 established airports encircling DSA.and said the airport wasn't necessary and would struggle. Turns out they were correct..

 

What the politicians seem to ignore, is that an airport can be either operated by them (the Local Authorities) or by the private sector. The latter means the LAs usually don't have to spend anything in the airport, yet benefit from it. The owners, hopefully, make money and everyone is happy (the green opposition apart). If the owners don't make money, then there's the risk of the airport closing if it's not viable as at DSA. Experts forecast before it even opened that it would fail, yet undeterred, Peel poured millions into it and made nothing. They gave it a good try.

Now, the politicians are starting an enquiry into what went wrong and how the regional assets can be protected. Well the answer is operate the airport yourself I guess! Then it's entirely in the LAs hands whether the airport succeeds or fails. Whether to close it or continue operating at a loss. They can't have their cake and eat it. The very fact that they were being approached by Peel for handouts should have been a warning to them that this was on the cards. They could have offered to buy DSA in the past or put significant money in and taken part ownership ensuring they had a say in its running, but I don't think they ever did.

The reality is that there are various other airports where this could happen. DSA may be the tip of the iceberg. A warning to other LAs with airports locally that success is not guaranteed, and that airports need help, not constant hindrance which might eventually lead to closure. South Yorkshire didn't hinder DSA in the way that LBA has been hindered over many years, yet the outcome was bad anyway. Perhaps they should all have listened to those aviation experts at the Public Inquiry into DSA who pointed to the other 4 established airports encircling DSA.and said the airport wasn't necessary and would struggle. Turns out they were correct..

I think there is a lot of information that is missing or has been withheld by DMBC Oliver Coppard and Peel.

We do know Peel approached Oliver Coppards predecessor with an offer of an equity share in the airport in return for £20million, this was refused when Peel were unable to provide a roadmap to profitability. Peel did not refuse to open their books that has been twisted.

We also know that certain managers at DSA had been given a payoff and left the business months before the announcement of the strategic review. So we know that this has been bubbling under the surface for longer than has been public knowledge. We’re DMBC and SYMCA made aware of this before.

This enquiry that Oliver Coppard has alluded to would surely uncover this stuff? However he’s suggested this wouldn’t be applicable to DSA and would be in place for any future such instances.

 

If the council are serious they will purchase the airfield. Simple as that.

There's plenty of land to sell on to developers to off-set the purchase costs.

 

If the council are serious they will purchase the airfield. Simple as that.

There's plenty of land to sell on to developers to off-set the purchase costs.

I doubt they can afford to pay the market price. It's a huge amount. If they do it then they are going to have to then spend another fortune, bringing a defunct airport back to life, with all that that entails, and having done so, and pretty much cleaned out the coffers , they are going to have to answer some serious questions if the airport still continues to struggle - which almost certainly it will.

I honestly don't believe these politicians when they say they are convinced the airport can be a success. The know nothing about the aviation industry, and are dabbling in territory that could leave them with very burned fingers. It all seems like political posturing to me to cover the fact that they could have prevented this closure before it got to this point.

It seems ironic though that they declined an equity share because Peel couldn't demonstrate a route to profitability, yet now they talk about spending huge amounts to buy the place under a CPO without having a clue as to future profitability or even who would run the airport. They had a hand in the report prior to closure, which outlined the problems attracting and retaining airlines, yet they appear to dismiss that now and think they can do better.

None of it adds up. You don't get aviation experts in to do a report which suggests no route to profitability, then dismiss it as the 'wrong answer' and spend a fortune buying the airport in an attempt to prove it can be profitable if run properly. It's totally wreckless .

 

If the council are serious they will purchase the airfield. Simple as that.

There's plenty of land to sell on to developers to off-set the purchase costs.

With a reported price tag of circa £250million, I just don’t believe the council have access to that amount of money. This is why everyone was looking to SYMCA to do this but they too have other obligations that take precedent and Oliver Coppard was pretty clear that the airport belongs in the hands of the private sector as it’s not a viable proposition for the public sector to take on. He obviously is also aware of the meeting that had taken place with his predecessor as mentioned in my previous post.

Ros Jones announced the option of a leasehold a couple of weeks ago and has not mentioned anything about this since, favouring the CPO. Even when pressed she has not acknowledged questions on the leasehold option. To me suggests that is off the table and not a reasonable proposition. Clearly Peel only did it to call their bluff in a preemptive measure which will be used later if the CPO is initiated.

CPO is another one relating to the council buying the airport, it seems the intention is to CPO it and sell it on to an private sector investor. It may be that they intend for no financial outlay from the council at all. Sounds like shaky legal ground to say the least, and I just cannot imagine it would get past preliminary stages.

All said it’s academic as it’s pretty apparent Peel do not want to sell.

 

they could have prevented this closure before it got to this point.

Are you referring to the equity share that Peel are reported to have offered? And if so, would that not just push the problem further down the road? Even if the Council had spent £20M and gained equity, more airlines/services and greater passenger throughput would be required to reach profitability.

it seems the intention is to CPO it and sell it on to an private sector investor.

Is it a requirement of a CPO, that it pays the market value for a business/property?

 

Are you referring to the equity share that Peel are reported to have offered? And if so, would that not just push the problem further down the road? Even if the Council had spent £20M and gained equity, more airlines/services and greater passenger throughput would be required to reach profitability.


Is it a requirement of a CPO, that it pays the market value for a business/property?

Point one is I think the point whiteheather is making. SYMCA know it’s not financially viable and there is no way to get the airport to breakeven let alone profitability. So they’re allowing the blame to be put onto Peel entirely so as to control the narrative.

I think it is in the case of purchasing a property/dwelling. It’s what constitutes market value for a piece of land that used to be an airport where there may be an argument in the councils favour. However, if there is anyone well versed in this it will be Peel. They will no doubt have significant clout and a trail of evidence to prove that aviation on the site is not viable and therefore, unless the land is to be left unused, the value under alternative uses is much greater than that which they’ve already sunk into it in capital and subsidised losses (estimated to be around £250million) so I would expect that the value will have to take into account the valuation of the land as would be redeveloped and the amount Peel spent on it to get it to this point would need to be taken into consideration. DMBC claim the land must be used for aviation purposes until 2035, but I doubt that will be legally binding, and the planning laws will allow for change of use if the previous use is proven to be non viable. I’m sure DMBC will be swayed eventually by the fact that they won’t be claiming rates on the site soon, and they’d potentially have a significant uplift in rates if it were to be redeveloped, not to mention the likelihood of increased employment opportunities and associated economic benefits.

 

Guy from Save DSA has been posting last few days about talks still ongoing between Peel and UAE investor, with some supposedly taking place last Friday.

Couple of points on that..

DSA Mole posted on PPrune on Friday evening saying it was ‘game over’ suggesting Peel had made it very difficult for anyone to keep interested. Were these talks the conclusion?

On the same day Nick Fletcher posted an update to say the landowners with whom DSA has an lease agreement to place the approach lights and marker beacons on had been notified by solicitors to the termination of the lease and the removal of the equipment.

Added to this, why would a company in talks to sell the whole airport want to sell off its assets to other airports, many of which being direct competitors?

I think Mark Chadwick is trying to save his group more than he is DSA, if he really is as informed as he claims to be he must surely know by now that Peel really do not have any intention in selling and no buyer would seriously pay the asking price for a failed airport to keep it as an airport, a point which Peel will know all too well.

 

He blocked me from that page for talking the truth. Was glad when Wai set another group up to give a more accurate reporting of the situation.

I cannot see the airport reopening, that chance has long since sailed.

 

Update by nick Fletcher this afternoon. DMBC cancelled the Friday meeting due to nothing to report which has obviously provided ammo for political slanging match to continue. One nugget though that needs elaborating on is that apparently Peel may have changed tack and may not now be terminating leases with the land owners, presumably the ones on which the approach lights sit. If this is the case it might suggest falls actually have progressed, but it’s vague and unconfirmed so could mean anything right now.

 

Hmm, meeting cancelled because there's nothing to report.
I think this is going to be repeated down the line. I can see that picture emerging especially with fortnightly meetings set, nothing to report, ohh I'm away on holiday.
The clock is ticking down to May when DSAL is totally dissolved, so would expect all equipment removed and sold before wound up date. So possibly 5/6 more fortnightly meetings left, one of them being Good Friday so will be cancelled for Easter break.

 

Hmm, meeting cancelled because there's nothing to report.
I think this is going to be repeated down the line. I can see that picture emerging especially with fortnightly meetings set, nothing to report, ohh I'm away on holiday.
The clock is ticking down to May when DSAL is totally dissolved, so would expect all equipment removed and sold before wound up date. So possibly 5/6 more fortnightly meetings left, one of them being Good Friday so will be cancelled for Easter break.

Need clarity on whether Peel actually have u-turned on terminating the land leases surrounding the airport. If they have it would suggest they are looking at selling. Next week may provide an indication with the pause on airspace ending 17th February. If they intend on selling then it will be Peel who need to let the CAA know not to continue closing the airspace, nobody else will have the jurisdiction to stop them or otherwise.

May well be that there is movement either way next Friday.

 

https://airspacechange.caa.co.uk/documents/download/5365

Looks like LBA have applied to retain some of the DSA CAT and submitted the attached yesterday ahead of the proceedings to close the airspace starting today.

Looks to me to be the Western side of the airspace they want to keep, and have asked that the altitude is increased from 2000ft to 4500ft. As far as I can see there is nothing from Peel as yet to halt the airspace closure.