DAL Delta Air Lines Inc

By Paul Berger 

The owner of New York's John F. Kennedy International Airport approved the $3.8 billion expansion of its busiest terminal.

Board members of the Port Authority of New York and New Jersey, at a meeting in lower Manhattan on Thursday, voted in favor of a lease amendment allowing the private operator of Terminal 4 to proceed with the modernization and expansion plan.

Terminal 4 handled 22 million passengers last year, making it one of the busiest entry points into the U.S.

The agreement with the terminal's operator is the last in a series of deals the Port Authority, a bistate agency, has struck with airlines and private terminal operators at JFK.

The deals are part of a planned $13 billion overhaul of the airport's roadways, taxiways and terminals, championed by New York Gov. Andrew Cuomo.

Mr. Cuomo's top appointee to the bistate agency, Port Authority executive director Rick Cotton, noted Thursday that JFK scores low marks in virtually every passenger survey ranking.

The Port Authority has set aside $1 billion toward overhauling the airport's central infrastructure. Private firms are expected to cover the remaining costs.

Roel Huinink, chief executive of company operating Terminal 4, said in an interview that initially his firm had more ambitious expansion plans that would have extended the terminal across the south side of the airport.

But the company, JFK International Air Terminal, lost out in 2018 to neighboring Terminal 1 in a competition for land at the 5,000-acre airport.

Instead, Terminal 4 is embarking on a more modest expansion and renovation of what is currently the airport's most modern terminal.

Beginning this fall, the firm will overhaul Terminal 4's roadways and its main terminal building, revamp its retail and dining areas and extend its eastern concourse, adding 16 new gates. The expansion will allow Delta Air Lines Inc., a minority stakeholder in the company, to consolidate all of its services into the terminal.

"Sometimes you have to take your loss and find new opportunities," Mr. Huinink said. "And I think we did."

The airport's six current terminals are each run by a different airline or private operator. By the time the overhaul is complete, around 2025, the airport is expected to have four expanded terminals. The Port Authority says the new terminals will be easier to navigate and will provide an improved passenger experience. Mr. Cotton has previously promised to transform JFK into a destination unto itself.

Terminal 4, which opened in 2001, served more than one-third of JFK's 60 million passengers last year.

In 2023, it must absorb more than 5 million additional passengers when Delta moves out of Terminal 2 to make way for its demolition pending the eastward expansion of Terminal 1.

JFK International Air Terminal is a joint venture led by a U.S. affiliate of Amsterdam-based Royal Schiphol Group. The terminal serves 33 airlines, including Air France-KLM, Emirates Airline and El Al Israel Airlines.

Mr. Huinink said the firm will add extra gates by more than doubling the length of its eastern concourse to 1,900 feet. He said that moving all of Delta's operations into one terminal will make connecting between flights, including on partner airlines, easier.

Write to Paul Berger at Paul.Berger@wsj.com

(END) Dow Jones Newswires

February 13, 2020 17:26 ET (22:26 GMT)

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