How Bad Is Business At Phoenix Sky Harbor Airport?
Phoenix Sky Harbor International Airport is not only seeing fewer passengers, but those travelers are also spending less at shops and restaurants.
Before the pandemic, Sky Harbor said the average passenger spent $11.38 on airport concessions. Now it’s $9.36. The drop was among the findings Interim Aviation Director Charlene Reynolds recently shared with the city’s transportation subcommittee. She broke down the latest passenger levels and spending.
“Of the 50% passengers that we are seeing only 36% of those passengers actually visit our food and beverage restaurants and only 25% of those passengers actually visit our retail locations,” she said.
Reynolds said before the coronavirus, airport food and beverage sales averaged $20.6 million a month. Now, it’s $4 million.
After being closed for six months, Joya Kizer Clarke reopened two shops at the airport.
“Flight schedules are inconsistent,” she told the subcommittee. “We’re having month over month loss in perishable inventory due to the reduction of passengers and specifically the loss of the business traveler. We are operating with about half of our pre-COVID team members. We watch our sales daily desperately searching for signs that we have enough stability to bring more of our team members back.”
Next month, the City Council is expected to discuss whether to extend rent relief for airport businesses into next year. In June, the council approved relief from April 1 through June 30 and then extended it through Dec. 31. Typically, concessionaires are required to pay a minimum annual guarantee but instead the council required businesses pay rent based on a percentage of sales only — generally between 13% and 15%. For 2020, Sky Harbor estimated it would collect about $20 million less from concessionaires.
As of Nov. 4, Sky Harbor reported 65% of food and beverage and retail concepts were closed in Terminal 3 which accounted for 30 outlets and 59% were closed in Terminal 4 which accounted for 91outlets.
Before the coronavirus outbreak, Sky Harbor said businesses offering services like banking and shoeshines reported $900,000 in average monthly sales. Currently, it’s $280,000. Advertising revenue in the terminals has also declined from a monthly average of $405,000 to $105,000.