Project Overview
Client
Listed & Private Companies & Corporations
Property Type
Infrastructure Including Toll Roads, Airports & Shipping Port Facilities
Reason for Service
Strategic Real Estate Advisory - Airport Infrastructure Planning
Preston Rowe Paterson was engaged by Qantas Airways Limited to develop a 20-year Strategic Real Estate Plan for Qantas’ Sydney Airport portfolio, integrating valuation, relocation planning, lease strategy and long-term financial modelling.
The instruction involved reviewing the airline’s airport property portfolio, leasehold interests, adjoining freehold assets, stakeholder accommodation requirements, airport master-planning impacts and the financial implications of alternative development and relocation strategies.
The brief also incorporated analysis of “Project Switch”, an alternative concept for a combined Qantas and OneWorld domestic and international terminal precinct.
The study became one of the most comprehensive strategic property reviews undertaken for an Australian airline, integrating aviation planning, valuation, town planning, facility relocation modelling, capital expenditure forecasting, lease negotiation strategy and airport infrastructure valuation.
Summary of Scope of Services
Preston Rowe Paterson delivered a multidisciplinary strategic property and valuation advisory engagement encompassing:
- Strategic real estate planning and occupancy strategy
- Freehold and leasehold interest valuation
- Review of lease expiries and make-good obligations
- Airport and off-airport market evidence analysis
- Stakeholder consultation across major operational business units
- Airport master-plan impact assessment
- Relocation planning, staging and sequencing
- Capital expenditure and cash-flow modelling
- Long-term occupancy cost forecasting
- Lease negotiation and rent-setting frameworks
- Capital markets and airport infrastructure advice
The review addressed the operational requirements of 12 stakeholder groups, including Engineering, Freight, Flight Training, QantasLink, Ground Support Equipment, Catering, IT, Security and Fuel Operations. Individual relocation strategies were developed for the relevant business units
Asset Overview:
The portfolio comprised approximately 119 leasehold interests and operational facilities across Sydney Kingsford Smith Airport, Mascot NSW, together with substantial adjoining freehold landholdings. The airport assets supported freight, cargo, engineering, aircraft maintenance, flight training, ground-support and fuel-related activities.
Approximately 185,776 square metres, or 18.58 hectares, of Qantas-owned freehold land was identified adjacent to the airport. The land contained more than 74,000 square metres of existing improvements and offered opportunities to relocate selected airport-dependent functions from leased airport land.
This engagement demonstrates Preston Rowe Paterson’s expertise in:
- Strategic real estate planning for major corporate occupiers, integrating property strategy, aviation infrastructure planning, valuation analysis and long-term portfolio optimisation
- Managing complex airport and infrastructure-related property portfolios, including leasehold interests, operational facilities, freehold landholdings and redevelopment planning
- Leasehold interest valuation and restructuring, identifying embedded value within complex tenure arrangements and supporting informed lease negotiation strategies
- Investment and development discounted cash flow analysis, capital expenditure forecasting and long-term occupancy cost modelling to support strategic decision-making
- Developing relocation strategies and transition frameworks for operationally critical facilities, ensuring alignment between business requirements, development programs and lease expiry profiles
- Airport infrastructure valuation, rent-setting methodologies and lease negotiation frameworks, helping clients optimise asset performance and manage long-term occupancy costs
Valuation Methodology
- Review of lease documentation, expiry profiles and make-good obligations
- Analysis of Sydney Airport’s 2009 Master Plan
- Assessment of airport and off-airport market evidence
- Valuation of freehold and leasehold property interests
- Analysis of terminal improvements and associated revenue streams
- Capital expenditure and cash-flow forecasting
- Relocation modelling and implementation sequencing
- Long-term occupancy-cost and net-present-value analysis
Approximately
119
Separate leasehold interests and operational facilities
Approximately
185,776m²
Qantas-owned freehold land
Approximately
74,000m²
of existing improvements
Preston Rowe Paterson combined strategic real estate advice, valuation expertise, aviation planning and financial modelling to address a complex airport property portfolio.
The analysis identified strategic opportunities to improve the use of Qantas’ adjoining freehold land and quantified substantial value associated with the Terminal 3 and Satellite leasehold interests. It also established a structured framework for managing lease expiries, relocation requirements, capital expenditure and future airport lease negotiations.
The resulting plan provided Qantas with a coordinated, long-term property roadmap that aligned operational requirements with financial and real estate decision-making. It demonstrated Preston Rowe Paterson’s capability in handling specialised infrastructure assets, complex tenure arrangements and major property-transition programs.
Value Delivered
- 20-year strategic airport property roadmap
- Comprehensive lease expiry and relocation framework
- Identification of significant leasehold value within Terminal 3
- Occupancy cost modelling through to 2030
- Development of airport lease negotiation strategy
- Alignment of operational, financial and property decision making across the Qantas business
We Deal with the Mainstream & Specialise in the Complex for all asset classes
