Investor proposals landing at Gary airport

2013-06-18T20:00:00Z 2013-11-08T14:43:07Z Investor proposals landing at Gary airportKeith Benman keith.benman@nwi.com, (219) 933-3326 nwitimes.com

The Gary/Chicago International Airport Authority is so far imposing an information blackout on responses to its recent effort to line up investors willing to put at least $100 million into the airport and its surroundings.

Monday was the deadline for investors to respond to the airport's June 7 request asking investors to express interest by making broad proposals. But the airport is hesitating to release any of the responses until at least Friday, after earlier promising to do so Tuesday.

On Tuesday, airport public relations consultant James Ward confirmed a number of proposals had been received by Monday's deadline. He would not give any details on what projects investor groups wanted to take on, but called the proposals "a nice combination."

Airport Interim Director Steve Landry and David Bochnowski, the head of a joint city/airport committee leading the investor search, did not return calls seeking comment.

Despite the airport's high hopes, a leading expert on public-private partnerships said shortcomings in its request could restrict the pool of potential bidders.

The small time slot of essentially just six working days from June 7, a Friday, to Monday's deadline would make it difficult for many firms to put together serious proposals, said Robert Poole, the founder of the Los Angeles-based Reason Foundation.

“Asking them to put together a serious concept of what might make sense in just six days just doesn't seem realistic, unless someone has already been working on this for six months,” Poole said.

The Gary/Chicago International Airport Authority will not say how many investor groups or individuals it solicited. However, The Times has obtained a list of more than two dozen businesses that received it. They range from U.S. consulting firms to international firms involved in airport construction and privatizations around the world.

Australia's Macquarie Bank, a key player in the 2006 privatization of the Indiana Toll Road, was one firm solicited, according to the list. Another was the Chicago-based investment firm William Blair, which was a key player in the Chicago parking meters privatization.

The Gary airport jointly issued its June 7 request with the city of Gary, which was formally titled a Request for Expressions of Interest and for Qualifications. It lists 16 separate projects investors can consider, including administering the airport's budget, running intermodal operations, operating light manufacturing, establishing retail distribution facilities and chartering jet aircraft. Investors can mix and match among them.

Longtime Chicago-area transportation observer and author Joseph Schwieterman, a DePaul University professor, said the solicitation appears to be serving as way of gauging interest and "getting the ball rolling" on the airport's quest for private investment.

"Gary has a promising future in both passenger and freight," Schwieterman said. "But it has to go at the pace the market dictates, and that will take patience."

Poole said the airport's recent solicitation can serve to kick-start the public-private partnership process and will certainly allow the airport to test the waters.

But he also said the airport's solicitation was unusual in that it also asked for investors' qualifications. That is a step always taken subsequent to the request for expressions of interest, he said. Asking for qualifications before the airport knows what specific project it wants to undertake also could put off some potential bidders, just as the short response window might.

The Gary airport's recent request notes a separate request for proposals will be issued at a later date.

And there is still a fundamental question looming over the Gary airport's drive for a public-private partnership, Poole said.

“It's an airport with zero passenger service,” Poole said. “That's the challenge here. Is there a market niche there that can provide a competitive advantage? The whole industry is actually asking itself that question at this point.”

For more photos, information and readers' comments on the proposed Illiana Expressway, go to https://www.facebook.com/IllianaExpress.

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