A new terminal will be built on the south end of Dallas-Fort Worth Airport as part of a $4.8 billion investment to expand and modernize the 49-year-old airport.
Additionally, the airport plans to renovate Terminal C and add gates there and at Terminal A, as well as upgrade roadways, DFW officials said at a news conference on May 16.
The deal comes after DFW Airport signed a 10-year use-and-lease agreement with airlines, including Fort Worth-based American Airlines, the dominant carrier at the airport.
A use-and-lease agreement with the airlines will allow the airport to move forward with its capital program, which addresses future growth and aging infrastructure needs. The new agreement lasts 10 years, starting Oct. 1 and replacing the previous lease signed in 2010.
Plans call for $1.63 billion to be used to build Terminal F, which includes 15 additional gates. The work at terminals A and C will cost $2.72 billion. The remainder of funds will be used for additional projects, such as redoing some terminal access roads, according to DFW Airport.
The project was previously announced in 2019, but was postponed due to the COVID-19 pandemic. DFW Airport CEO Sean Donohue said Terminal F is expected to be completed at the end of 2026. The projects at Terminal C should be wrapped up by the end of 2028, he said.
“The site of Terminal F allows for future growth in additional gates, as American and other airlines continue to grow at DFW,” Donohue said.
Terminal expansions will bring 24 more gates, Donohue said. The airport has 171 gates, according to its website.
Both the airport and American Airlines have a large economic impact on North Texas.
DFW Airport is the second-busiest airport in the world, behind Hartsfield–Jackson Atlanta International Airport. The airport produces an estimated $37 billion in economic impact every year, according to DFW.
American Airlines has 35,000 employees at the airport and at the airline’s nearby headquarters in far east Fort Worth. The company has a $42.7 billion economic impact annually in Texas.
“The use and lease agreement outlines our ability to continue to grow as an airport and support the future growth over the next couple of decades,” Donohue said.
By the end of the year, Donohue expects DFW Airport to serve 78 million customers, setting a new record.
American’s CEO, Robert Isom, said the partnership with DFW Airport is strong. The airline operates more than 800 flights out of the DFW Airport a day, Isom said.
“Our strategic focus is right here in DFW, and it’s our largest hub,” Isom said. “And it’s the central gateway to everything that we do in our network domestically and internationally.”
A use-and-lease agreement is a type of contract many airports across the country make with airlines serving the airport, said Jeff Benvegnu, the president of BenView Strategies LLC. His consulting firm specializes in airport use-and-lease negotiations.
From an airline company’s perspective, the agreement is important because it determines charges such as landing fees and terminal rents, he said, which can make up to 8% of what airlines will pay in their overall profits and losses. It also gives airlines a say-so on how an airport will pursue its capital program.
“Especially in a place like DFW that’s 50-plus years old, that has a lot of capital requirements in terms of renewal and replacement and other infrastructure,” Benvegnu said. “The airlines want to have a seat at the table as to how that money is going to be spent, and how that’s going to impact the airlines.”
For airlines like American Airlines, it can ensure it has enough gates to continue to grow and remain competitive with other hubs, he said.
Terminal F is important, Benvegnu said, so that the airport can accommodate the expansion of airlines.
“As American continued to grow its hub and DFW had a lot of success with foreign flag carriers coming into the market, they really tapped out in terms of available gates, especially on the international side,” Benvegnu said. “So that’s why (Terminal F) is so important; are there enough gates for American, for international carriers and even domestic other airlines that want to serve the market?”
There are 28 passenger airlines operating out of DFW, including 12 domestic and 16 foreign flags. Those planes fly to 191 destinations across the country and 63 internationally, according to DFW Airport.
Isom said he wants to help take DFW Airport up a notch, from second busiest to first.
“We want to be the busiest airport in the world,” Isom said. “And as you can see, we’re building the foundation to do that both in the facilities and also on the airfield as well.”
Seth Bodine is a business and economic development reporter for the Fort Worth Report. Contact him at seth.bodine@fortworthreport.org and follow on Twitter at @sbodine120.
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