Air cargo is vital contributor to the NYC economy, supporting over 50,000 jobs, $8.5 billion in sales, and $3 billion in annual wages at JFK International Airport. However, the industry has experienced significant structural and pricing changes over the last two decades, and JFK has lost market share to other airports throughout the United States.
RESGroup completed a benchmarking analysis for the Port Authority of New York and New Jersey (“PANYNJ”) for their portfolio of air cargo buildings and developable land at JFK International Airport to understand their competitive advantages and disadvantages in attracting and retaining tenants. The analysis allowed the PANYNJ to better understand the competitive positioning of their 4 million square feet of on-airport cargo facilities relative to other airports in the United States, including Boston, Dulles, O’Hare, and LAX, as well as the local industrial warehouse-distribution market in southeastern Queens and southwestern Nassau County in New York. RESGroup also created a user-friendly repository for property level information based on the PANYNJ’s different databases and other resources.
A significant finding of the analysis was that the air cargo facilities were generally older and had a lower quality level than in the airport peer group. RESGroup made strategic recommendations to allow the PANYNJ to better compete regionally and nationally for cargo business. A recent step forward at JFK was a ground lease with Aeroterm for the development of a state-of-the-art 346,000 square foot cargo facility at the airport. The $132 million project includes the new facility as well as upgrades to taxiways. Aeroterm specializes in the development and management of airport-related cargo facilities, with the largest portfolio of on-airport properties in North America.