January 31, 2014 // Franchising.com // South Bend - On Jan. 27, the Gary/Chicago International Airport Authority closed a public-private partnership (P3) deal that will pump $100 million into redeveloping and expanding the airport over the next 40 years. Faegre Baker Daniels LLP served as lead deal counsel for the airport authority on this transaction.
The P3 agreement requires primary investor AFCO Avports Airport Management LLC (AFCO) of Dulles, Va., to invest $25 million in capital during the first three years for upgrades or other projects, and $100 million over 40 years. The airport authority retains airport ownership and will provide operating costs, up to $120,000 per year in management fees and up to 20 percent of the facility's profits to AFCO.
The FaegreBD team also negotiated a master development agreement with AFCO's partner organization, Aviation Facilities Co. Inc., which requires Aviation Facilities to provide $300,000 over three years to promote jobs in northwest Indiana. The agreement builds in minimum thresholds for minority-, women- and veteran-owned businesses, as well as local businesses.
FaegreBD partners Richard L. Hill and Regina M. Sharrow advised the airport authority, including managing the REIQ and RFP process and negotiating agreements with investors AFCO, Aviation Facilities, Guggenheim Securities and Loop Capital.
The P3 transaction is expected to boost economic activity in northwest Indiana and transform the airport, located 30 minutes from Chicago, into a viable third air transit option for the nation's third largest city.
Dedicated to providing quality service, low cost and convenient access, the Gary/Chicago International Airport (GYY) has set its sights on continued growth and expansion. Recognized as Chicago's Third Airport, GYY represents the highest degree of safety and operational efficiency with lots of capacity and room to grow.
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