Independent infrastructure fund manager, Global Infrastructure Partners (GIP), is selling its oldest airport asset, London City Airport (LCY), with UK media reports suggesting a £2bn/$3.1bn price tag.

In a statement to TRBusiness, a spokesperson for London’s most central airport says: “London City can confirm that its owner, Global Infrastructure Partners has indicated its intention to sell the airport. GIP has owned LCY for nine years and has improved it hugely during that time.  It is the right time to sell for the investors.”

The news of the sale comes after LCY was refused planning permission by London Mayor Boris Johnson for its City Airport Development Programme (CADP).

Perfect location but short runway

GIP has not commented on the exact reason for the sale, but it could be that the company sees more long-term value in its other transport assets.

Through consortia it owns the UK’s second busiest airport, London Gatwick – which last year had strong international traffic growth of +8.9% – and Edinburgh Airport, the busiest airport in Scotland. LCY is ranked 15^th with 3.65m passengers.

POPULAR, BUT LIMITED SCOPE

LCY is known for its easy access and quick processing, making it the airport of choice for executives in the financial City of London. However, its short single runway limits the type of aircraft that can use the airport and therefore – apart from a flight to New York JFK – it serves mainly European destinations. It also has terminal capacity issues due to its popularity.

The LCY spokesperson comments: “The market for quality assets, and particularly airport assets, is strong. It is business as usual at the airport – the sale process will have no impact on its operation, on its plans for growth or on the appeal it has mounted against the refusal of planning permission for the City Airport Development Programme (CADP).”