Orlando, FL airport terminal costs swell to $2.15B

Dive Brief:

The Greater Orlando (FL) Aviation Authority (GOAA) on Wednesday unanimously approved a $350 million increase for a new Orlando International Airport (OIA) terminal project, bringing its price to $2.15 billion, according to the Orlando Sentinel.
Officials said the increase was necessary to cover the inflation and rising costs of construction that have resulted from a booming local economy, a more expensive baggage system and additional technology that will go into the project. The airport will pay for approximately $149 million of the additional costs with airport user fees, which total about $70 million annually.
Nearby projects like the 21-mile, $2.3 billion, Skanska-led Interstate 4 Ultimate Improvement project are causing local labor cost increases, as well as upticks in the price of concrete and steel, according to officials.

Dive Insight:

PCL Construction Services, a contractor on 11 other OIA projects, was initially chosen to execute the first phase of terminal construction, but GOAA canceled the company's contract in March. The authority said PCL was trying to push too much of the risk onto the airport, but PCL said that GOAA ended the company's participation on the terminal project because the authority did not agree with the contractor's cost-savings strategy.

PCL would have built 16 to 21 new gates, a parking garage and ground transportation area as part of its contract. The joint venture of Kiewit and Turner Construction will still perform the second phase — including runway and taxiway infrastructure, loading bridges, landscaping, lighting, concessions, security — as originally planned.

The new terminal is just one piece of an overall OIA plan to build an 1,800-acre mixed-use development, which includes a warehouse development for companies that do business with the airport.

Several large U.S. airport renovation projects have kicked off over the last few years, including one in Tampa, FL, about 90 miles down I-4 from Orlando.

Tampa International Airport is undergoing a $2.3 billion multiphase expansion and, like OIA, is looking to develop commercial space on surrounding land. In addition to the $971 million first phase, which includes retail, restaurants, a people mover system and rental car center, Hillsborough County Aviation Authority officials are now looking to the $543 million second phase — 17 acres of commercial development — to provide long-term revenue to fund ongoing airport operations and maintenance.