The Value of Flexibility in Airport Planning: A Real Options Analysis

摘要

In the last two decades, airports have suffered major changes. Governments, airport authorities, airlines and other stakeholders invested large amounts of capital, building large and capital intensive infrastructures under a great deal of uncertainty. The risk comes mainly from the difficulty in forecasting demand in the long run. Under a highly dynamic environment, how to make economically rational decisions on investments of billions of Euros, and with revenue highly unstable and unpredictable? Literature and empirical evidence, suggests that the development of airports should be done in incremental steps, decreasing the CAPEX and thus making the project less risky. This paper, looks at a case study–the future new Lisbon Airport-identifying the possibilities for flexible solutions, and quantifying the economic value of developing a more flexible “airport system development plan”. The methodology used is a Real Options analysis for a 30 year timeframe. Results suggest that by developing flexible solutions, economic benefits (both public and private) may be expected.