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...?

 

A consortium rarely ends well. The very fact that there is no individual company and they are resorting to groups of companies who may not work well together, isn't a good sign.

I cant help but think that once any consortium does due diligence and sees the DSA books, including how airlines were enticed to go there, and the losses, and the running costs, there may be some members who think twice.

 

A consortium rarely ends well. The very fact that there is no individual company and they are resorting to groups of companies who may not work well together, isn't a good sign.

I cant help but think that once any consortium does due diligence and sees the DSA books, including how airlines were enticed to go there, and the losses, and the running costs, there may be some members who think twice.

When there is mention of a consortium it makes me think that it would be a public/private venture. Sharing the risk and reducing the burden on the tax-payer as much as is practically possible. Feasible in my view, but still the major barrier is Peel and their apparent unwillingness to budge. It’s hard to tell whether Peels public rebuffing of all counter announcements from SYMA working group are to push the price tag up, or whether they truly are at an advanced stage in plans for alternative land uses. To counter that, I think SYMA are coming at it from a GVA standpoint, there is a suggestion that the airport contributes £50million per year to the local economy. I’m always a bit skeptical of these figures, just how much does an outbound holiday focussed passenger operation with the odd cargo and GA outfit contribute so much to the regional economy? Arguably any redevelopment would create more jobs, probably increasing GVA further.

They’re an astute bunch are Peel, I suspect they already realised they can add many £millions to the land value by redeveloping if, much more than the airport is worth on paper.

 

When there is mention of a consortium it makes me think that it would be a public/private venture. Sharing the risk and reducing the burden on the tax-payer as much as is practically possible. Feasible in my view, but still the major barrier is Peel and their apparent unwillingness to budge. It’s hard to tell whether Peels public rebuffing of all counter announcements from SYMA working group are to push the price tag up, or whether they truly are at an advanced stage in plans for alternative land uses. To counter that, I think SYMA are coming at it from a GVA standpoint, there is a suggestion that the airport contributes £50million per year to the local economy. I’m always a bit skeptical of these figures, just how much does an outbound holiday focussed passenger operation with the odd cargo and GA outfit contribute so much to the regional economy? Arguably any redevelopment would create more jobs, probably increasing GVA further.

They’re an astute bunch are Peel, I suspect they already realised they can add many £millions to the land value by redeveloping if, much more than the airport is worth on paper.

Consortium or not - any prospective purchaser is going to look at things objectively in the manner you describe and therein lies the problem. After 17 years or whatever it is, of losses (even for a property developer) their returns have been woeful which leads to the conclusion that Prescott was right all along when he said that DSA was in the wrong place. Peel have milked the grants system for all its worth and have now decided to do the proper thing and close it in order to develop their asset and eventually make some money.

 

Doncaster Airport has confirmed today that it will be winding down operations from next month.

 

Doncaster Sheffield Airport -

Voted the UK's Best Airport by Which? magazine three years in a row.

flydsa.co.uk

Full statement now from Peel Group, clarifying some of the political claims.

 

I would venture the Prime Minister was caught on the hop when faced with the possible closure of Doncaster Sheffield and consequently blurted out an ill thought-out and somewhat naive response. There will be no taxpayers' money to save DSA (also what Peel has said), no compulsory purchase order and no eleventh hour rescue. Peel is closing Doncaster Sheffield Airport. Sad but true. Anyone who wishes otherwise is in a fantasy world.

 

I would venture the Prime Minister was caught on the hop when faced with the possible closure of Doncaster Sheffield and consequently blurted out an ill thought-out and somewhat naive response. There will be no taxpayers' money to save DSA (also what Peel has said), no compulsory purchase order and no eleventh hour rescue. Peel is closing Doncaster Sheffield Airport. Sad but true. Anyone who wishes otherwise is in a fantasy world.

'I will do what I can and speak to the relevant people' suggests to me that she knows she's blotted her copybook on day one over DSA. It's a typical MPs side step. Only a CPO can stop the closure and no way can Liz justify spending £100m+ to save an airport with no airlines and no prospects.

 

The actions and rhetoric of politicians, both national and local, are heavily influenced by the need to be elected/re-elected. For over 20years the population of South Yorkshire has been told that DSA is a vital element in the regeneration of its economy following the demise of the mining industry and contraction of the steel industry.

Labour have been in power in the area for the majority of this period. Their politicians will find it hard to pull their support for DSA, even if it is the sensible action to take.

The area now has a number of ‘red wall’ seats and so the government also has a problem if it is seen to pull the plug. Interesting times especially as the airlines have flown away! Perhaps their get out could be the lack of funds resulting from economic mess that they are creating.

 

The actions and rhetoric of politicians, both national and local, are heavily influenced by the need to be elected/re-elected. For over 20years the population of South Yorkshire has been told that DSA is a vital element in the regeneration of its economy following the demise of the mining industry and contraction of the steel industry.

That is all John Prescott said. And that is why he give the go ahead to have an international airport at Doncaster. He said in the report the UK and the area didn't need another airport.

I would venture the Prime Minister was caught on the hop when faced with the possible closure of Doncaster Sheffield and consequently blurted out an ill thought-out and somewhat naive response.

This is what I've thought. Definitely a ill though blurted out response. Simple fact of the matter is Doncaster was always unviable from the outset. I wonder, despite their effort, if easyJet could have done a lot better out of Doncaster.

 

The SY Mayor Oliver Coppard wants the government to instigate powers from the Civil Contingencies Act which would be the only option open for a speedy intervention by the government. This would require the closure of DSA to be classed as a national emergency. I would suggest this would be a virtually impossible scenario to justify. For those unfamiliar with the CCA, the link gives a brief of this legislation:

https://narueducationcentre.org.uk/wp-content/uploads/2012/12/CCA-short-guide.pdf

The only other option is CPO, this is a power devolved to local government so would be in the power of the offices of the Mayor of either SY or Doncaster. The time taken to do this would take many months if not years. You can assume Peel will appeal in the courts.

I would wager that shortly after closure, Peel will strip the airfield of most of its operational/navigational equipment meaning any prospective owner after a CPO would need significant investment to get it back to a licensed airport status let alone market it to prospective airlines. This will be a huge risk for the Mayoral office to carry with no certainty of outcome and suspect after the ambient noise dies down in a few months, Doncaster Council will quietly negotiate with Peel to unlock the employment and development potential of the site with their vision.

It does feel it’s all over bar the shouting.

 

The SY Mayor Oliver Coppard wants the government to instigate powers from the Civil Contingencies Act which would be the only option open for a speedy intervention by the government. This would require the closure of DSA to be classed as a national emergency. I would suggest this would be a virtually impossible scenario to justify. For those unfamiliar with the CCA, the link gives a brief of this legislation:

https://narueducationcentre.org.uk/wp-content/uploads/2012/12/CCA-short-guide.pdf

The only other option is CPO, this is a power devolved to local government so would be in the power of the offices of the Mayor of either SY or Doncaster. The time taken to do this would take many months if not years. You can assume Peel will appeal in the courts.

I would wager that shortly after closure, Peel will strip the airfield of most of its operational/navigational equipment meaning any prospective owner after a CPO would need significant investment to get it back to a licensed airport status let alone market it to prospective airlines. This will be a huge risk for the Mayoral office to carry with no certainty of outcome and suspect after the ambient noise dies down in a few months, Doncaster Council will quietly negotiate with Peel to unlock the employment and development potential of the site with their vision.

It does feel it’s all over bar the shouting.

I think your analysis is spot on. I’m afraid there were no checks and balances in place to safeguard the site back when FARRRS was invested in (at great expense to the tax payer), and this is something that was mentioned on this forum and elsewhere at the time of the scheme gaining approval. This should have all been done many years ago, and this is why we are in the situation we are in now.

The airport has never been a viable financial proposition, but in the right hands could have been handled much differently. The land value following the opening up of the eastern side of the M18 should have been used to subsidise aviation business on the site, much like at Manchester, but instead the airport has been run as an arms length stand alone business.

Surprised lessons weren’t learned after the demise of Sheffield City. They really should be now.

 

Quire correct pug. I've always said that Peel are cute and this situation aptly demonstrates that. I think it shows, quite vividly, that when they publicly state something is going to happen they mean it and have spent the necessary amount of time discussing and ensuring their decision is 'correct' before publicising it. Due to that I believe there will be no going back on the decision they have made and that they will now start to cash in on their assets there.

That means the end of aviation at DSA as we know it and the start of redevelopment there which will bring jobs to aid the local economy. So there will initially be all the pain that closure will bring but that will only be temporary thankfully.

 

Meanwhile, BBC Look North continue with their daily campaign for Government intervention, (every day this week) and the Mayor has apparently become so desperate that Richard Branson has been asked to buy the airport. A change of name to DSA Virgin Airport in the offing?

If Branson shells out £100m+ on an airport with no airlines and not a £1 profit in 17 years, then age is catching up with him. There's talk of preventing all alternative site use other than aviation until 2035 - whether that's legal or not I wouldn't know but I think Peel won't take that lying down.

Things could get nasty!

 

Meanwhile, BBC Look North continue with their daily campaign for Government intervention, (every day this week) and the Mayor has apparently become so desperate that Richard Branson has been asked to buy the airport. A change of name to DSA Virgin Airport in the offing?

If Branson shells out £100m+ on an airport with no airlines and not a £1 profit in 17 years, then age is catching up with him. There's talk of preventing all alternative site use other than aviation until 2035 - whether that's legal or not I wouldn't know but I think Peel won't take that lying down.

Things could get nasty!

Peel will be building on the site much quicker than most people think they won't sit on the land long they tied up Liverpool and Salford and aren't many people's cup of tea in either place, may they have done the same here if you believe some report's they pretty much run both those places who knows what influence they could have in Doncaster too the way they have ended things here makes me think they have every belief they will be raking the money in pretty quickly. Peel have got away with murder it should never have reached this stage the only consolation as little as it would be is if the whole truth comes out of exactly how much they did screw DSA to get to this stage at least is appears that Oliver Coppard has plenty of solid information to back this up.

 

I disagree. Peel have given the airport ample time to pay its way. It hasn't and arguably never would. The idea that it was just aquired to convert into somekind of industrial use is frankly ridiculous. If that is what Peel now do with the land, that's up to them but nobody can say they didn't try.

 

I disagree. Peel have given the airport ample time to pay its way. It hasn't and arguably never would. The idea that it was just aquired to convert into somekind of industrial use is frankly ridiculous. If that is what Peel now do with the land, that's up to them but nobody can say they didn't try.

With respect Aviador that comment is naive and somewhat debatable considering Peel have milked as many grant streams as they have been able to enhance any future development they will do there. That funding stream has now come to an end but it coincides with their decision to close the airport. A coincidence? I think not.

 

Yes, generally when the losses get even worse (because grants which made up for some are stopped) you close the business. You seem to be trying to equate normal business practice with conspiracy.

 

Some equipment if it's suitable will be coming to Liverpool

 

Yes, generally when the losses get even worse (because grants which made up for some are stopped) you close the business. You seem to be trying to equate normal business practice with conspiracy.

This is true, and as Aviador has alluded, Peel will have been monitoring the success of Doncaster Airport Ltd as a stand-alone business. It has had the expertise and tools available to it to really carve a place for itself, but this hasn’t worked out well enough to sustain the operation. So plan B is being enacted.

I stand by my comment that some form of legally binding clause should have been implemented when FARRRS was funded and built, as it effectively unlocked a huge amount of development land with direct connection to the motorway. Alas this was not done, leaving the airport to the mercy of the owner who as we all know are property developer first and foremost.

I still do not see any reasonable argument against Peel doing what they do, they’ve given it chance and despite all the funding, loans and grants have still invested a significant amount of capital into the place over the years. How can you blame them then if the region fails to support it and the airlines are on the whole ambivalent to the place?

 

This is true, and as Aviador has alluded, Peel will have been monitoring the success of Doncaster Airport Ltd as a stand-alone business. It has had the expertise and tools available to it to really carve a place for itself, but this hasn’t worked out well enough to sustain the operation. So plan B is being enacted.

I stand by my comment that some form of legally binding clause should have been implemented when FARRRS was funded and built, as it effectively unlocked a huge amount of development land with direct connection to the motorway. Alas this was not done, leaving the airport to the mercy of the owner who as we all know are property developer first and foremost.

I still do not see any reasonable argument against Peel doing what they do, they’ve given it chance and despite all the funding, loans and grants have still invested a significant amount of capital into the place over the years. How can you blame them then if the region fails to support it and the airlines are on the whole ambivalent to the place?

Although Peel have secured all sorts of public monies to build link roads etc. which now enhance the sale price of the airport land for Peel, there is no doubt that the region still benefits, as that infrastructure now makes the airport land more attractive to new industries, warehousing and possibly housing too. The new industries will bring more jobs, and given the area involved, probably more than the 800 jobs lost at DSA. The region will still benefit but in a different way, and of course, there will be a significant gap between airport closure and money coming in from new developments on site.

People forget though that had it not been for Peel Holdings, there wouldn't even be a DSA. They built it into what it is, despite being told up front that it wasn't needed and was unlikely to succeed. They threw their money into it for 17 years - a gamble that failed. It's funny to hear people saying that DSA fell into the wrong hands. Without Peel it would have been warehousing and industry and housing years ago! They developed it, and it's theirs to do with as they see fit - the down side of private enterprise.