A push to modernize airports to fuel more shopping

This summer, while traveling from New York to Denver, Marc Stewart noticed that the Delta Air Lines terminal at La Guardia Airport felt unfamiliar.

“Usually, I fly United, which means you are in the old concourse where there are not even enough bathrooms. So, I was pleasantly surprised when I walked into Delta’s terminal at La Guardia and saw some innovative options,” said Mr. Stewart, 45, a television journalist. “As soon as you go past security, you see a food setup that’s reminiscent of Whole Foods. There’s a food bar, snacks beyond potato chips. It is a completely different feeling.”

What Mr. Stewart encountered is going on all over the world. Airport operators are updating aging terminals and constructing new ones, wooing travelers with retail and dining options that encourage them to spend more money. And they are spending as much as 30 percent more at some airports, according to OTG, the airport concessionaire that worked with Delta on the remodeled terminal that Mr. Stewart visited.

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When revenue from airport amenities goes up, the fees airlines pay to use an airport can go down, which in turn can attract more airlines to offer service to the region.

It is up to the airport “to be attractive to the customers: both the airline and the traveler,” said Angela Gittens, director general of Airports Council International, a trade group. By providing more services and better shopping, an airport can “keep their aeronautical charges down and entice airlines,” she said.

When it comes to commercial real estate, airports offer the two biggest factors linked to retail success: location and foot traffic. The average time a traveler waits at the airport is more than two hours, according to an article published by the International Council of Shopping Centers.

Recognizing this, airports large and small are redesigning their buildings and changing the products and services on offer, following the example set over the past two decades by airports in emerging markets.

Airports in Hong Kong, Beijing and Doha, Qatar, reset the standard with dazzling architecture, capacious restrooms, comfortable seating at the boarding gates and plenty of power outlets throughout the terminals. Skytrax, an aviation-ranking site based in Britain, has given Singapore’s Changi Airport the award for best airport six years running in part for its butterfly garden, movie theater, pool and two hotels. Its latest upgrade is the Changi Jewel, a 10-story hotel and entertainment complex, which opens to travelers next year.

“Our airports cannot compare in their present state to the major international airports in Europe or Asia,” said Rick Cotton, executive director of the Port Authority of New York and New Jersey, which runs Kennedy International Airport, Newark Liberty International Airport and New York Stewart International Airport in addition to La Guardia. “This country has allowed its infrastructure and its airports in particular to fall far below the global standard.”

In a 2014 speech now famous among airport executives, Joseph R. Biden Jr., then the vice president, suggested that La Guardia was like a “third world” airport. One year later, Gov. Andrew M. Cuomo of New York announced plans to direct $20 billion in redevelopment money to the area’s three largest airports.

When the overhaul of La Guardia’s Terminal B is complete, travelers will be able to see from the escalator “the dynamic environment of a commercial district, with a spa, food, well-curated retail and dining options,” according to Ed Baklor, chief commercial officer for La Guardia Gateway Partners, the private company working on the project with the Port Authority.

The project is the nation’s largest airport renovation program, Mr. Cotton said. But there are other multibillion-dollar makeovers in the works at Los Angeles International Airport and in Chicago, at O’Hare International and Chicago Midway International airports. The airports in Kansas City and Seattle are also revamping their passenger terminals.

In Pittsburgh, where a $1.1 billion modernization plan was unveiled last fall, the terminal retail area is now open even to nontravelers. It’s a return to the airport’s status as a shopping center for area residents, a distinction that was cut short by post-9/11 security measures.

“We did this because this community is very invested in its airport,” said Christina Cassotis, chief executive of the Allegheny County Airport Authority. “They’re proud of it; they miss going to it to see planes take off and to go to shop.”

The airport authority is overhauling the once-booming hub for US Airways at the Pittsburgh airport because its merger with American Airlines in 2015 led it to substantially cut its operations there.

When Midway airport on Chicago’s southside embarked on its $400 million modernization program in 2015, its retail facilities had been unchanged for two decades. In the redesigned Midway, the number of vendors will increase 40 percent and many will be local businesses, including Garrett Popcorn Shops, a chain whose downtown Chicago stores are so popular it is not unusual for lines to form down the street.

When Garrett opened its first location outside of the city in 2008, it was at O’Hare Airport’s Terminal 1, said Megan Chody, Garrett’s director of community relations. And though Ms. Chody would not discuss sales figures, the company quickly added a second location in O’Hare’s Terminal 3.

“I’ll make a wager that some people who want the Garrett’s experience may choose O’Hare as a stopover as opposed to some other city,” Ms. Chody said.

Airports executives say they are viewing commercial space with new enthusiasm for the dual role it can play: generating greater sales and attracting more travelers.

Travelers do look for information about airport specifics before buying airline tickets, research from Airports Council International shows.

Teresa Lensch, a real estate agent, learned that some airports are better than others while changing planes at Incheon International Airport in Seoul.

“I love the fact they have massage chairs and movie theaters and you could see groups of entertainers perform plays and mini museums,” said Ms. Lensch, 45. “No matter what time it was, there was something you could eat and have a cocktail if you wanted to. I was thrilled and very surprised by that.”

Other factors also affect the passenger experience, including parking, mass transit connections and car rental facilities outside the building and the security checkpoint on the way to the boarding gate.

“There are a lot of facilities that haven’t been changed in 50 to 60 years,” when airplanes were smaller and airports not as busy, said Curt W. Fentress, an architect who worked on a number of airports, including Seoul’s Incheon, the Tom Bradley International Terminal at Los Angeles International Airport and Denver International Airport. Airports are “not that easy a place to navigate unless you are used to using it,” he said.

Investors in airport retail say that has to change because there is a direct correlation between reducing stress and the amount that passengers spend, Mr. Baklor said.

But at a time when technology is intended to make many things easier, a growing number of companies at the airport serve narrow slices of information to the traveler in dozens of individual apps, which can make travel more complicated. Travelers can get frustrated not knowing which app to use to find an airport map, or what nearby restaurant offers vegetarian fare.

“It’s a land grab,” said Robin Hopper, president of GuestLogix, a travel revenue technology company. “If you are a traveler that relies on your phone and you want that digital concierge experience, you’d have to download nine or 10 apps.”

If the goal is to create a traveler so relaxed there is time and interest in lingering at an airport shop or cafe, easing the information overload is another challenge the modern airport faces.

“Airports are furthest along in innovative thinking. They realize they have to play nice with other apps,” Mr. Hopper said. “The whole traveler experience is not defined by time in the airport but defined by the overall experience.”

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