Regenerating Subang Airport; proposals welcome

  • Business
  • Monday, 17 Dec 2018

Aerospace plan: Malaysia Airports Holdings Bhd plans to build the Subang Skypark area into an aerospace park costing about RM400mil.

PETALING JAYA: MALAYSIA AIRPORTS HOLDINGS BHD (MAHB) is said to have issued requests for proposals (RFPs) to both local and international consultants for the Subang Airport regeneration project to be undertaken on a 1,063-acre site.

The RFPs are to appoint a master planner for the concept and design.

Fifteen local and international consultants are said to have picked up the documents. They are expected to submit their bids by the end of this month, industry sources said.

The total development cost for the regeneration that could take up to a decade to complete is estimated at RM1.5bil to RM2.5bil, depending on the final concept and design.

The development is expected to be undertaken via its unit, Malaysia Airports (Subang) Sdn Bhd, and MAHB is likely to partner developers for the different parts of the project.

“The idea is to give Subang Airport a total makeover, maximise the usage of land in the area with its aerospace ecosystem in place and push further to tap the opportunities that are now going to its competitors in the region,” they said.

They said there are three parts to the regeneration of Subang Airport – the expansion and upgrading of existing terminal and air site facilities to create a city airport; to remodel as a business aviation hub and have a complete aerospace ecosystem to support the maintenance, repair and overhaul (MRO) and aero-manufacturing activities for the region.

“For years, Malaysia has been losing out to Singapore’s Seletar Airport in terms of MRO and business aviation. It is not just the upgrade and refurbishment that are needed, but Malaysia needs to make it simpler for private jet owners to fly into Subang and attract them since matured hubs like Hong Kong and Singapore are congested and pricey,” they said.

It is, therefore, vital for MAHB to select the “right consultant as the master planner that has the right expertise in building hangers and industrial development,” they said.

MAHB may take a few months before it appoints a master planner, who, in turn, will take six to nine months to get the full-blown concept plan ready.

The new terminal, once completed, will be able to handle five million passengers from three million now. The entire development is likely to create 5,000 jobs and attract investments of over RM1bil by 2025, the sources said.

As it is, there are several MRO companies located in Subang and they include GE Aviation, GTA-Safran Heli Engines, Ruag, Airod, Skyways Technic (for ATR); two aero manufacturers (Spirit Aerosystems, Senior Aerospace) and two helicopter centres (Airbus Helicopter Malaysia and Leonardo (Augusta Westland); and business aviation (Execujet, Hawker Pacific, Skypark (FBO) and Sapura Aero).

MAHB is an airport operator and its lease of tenure is for 49 years, expiring on Dec 30, 2066. For this development, MAHB will need to engage with the government as to how to fund the project.

Of the entire 1,063 acres development, the only green field is a 60-acre site near the Subang Skypark, which MAHB will develop into an aerospace park costing about RM400mil.

Sources said MAHB, which will be partnering a developer for this project, is likely to make an announcement in the coming months.

Separately, MAHB is also developing the KLIA Aeropolis and Digital Free Trade Zone near KLIA with its partners.

But the regeneration of Subang Airport and making it into an aerospace hub with a complete ecosystem to support its growth is not a new thing.

The idea was first mooted in 1997 but it never took off in the way it was planned due to lack of investors.

Prime Minister Tun Dr Mahathir Mohamad last month said Malaysia might need many aerospace hubs to support the development of the industry as it has been identified as one of the sub-sectors in focus in the second half of the 11th Malaysia Plan from 2016-2020.

This time around, and apart from MAHB with its Subang Airport regeneration initiative, even its parent, Khazanah Nasional Bhd has planned to develop an 80-acre piece of land in Subang into an aerospace hub.

It was also reported that Khazanah will cooperate with the related agencies including Majlis Amanah Rakyat to create a highly skilled workforce which is needed to support the aerospace industry.

About 20% of the current Malaysian aerospace eco-system is located in Subang and the KLIA Aeropolis.

The economic generation from this entire aerospace initiative by the various parties will run into billions of ringgit and create hundreds of jobs for the country.


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