BTV hotel may be delayed as airport reels from steep drop in air travel
A delay in plans to start construction this summer on a 110-room hotel at Burlington International Airport may be yet another of the growing economic impacts due to the drop in travel as officials try to curb the spread of the COVID-19 virus.
By the end of March, Vermont and much of the US has seen a dramatic drop in all social and economic activity as schools, businesses and community events have largely stopped regular operations in response to the worldwide pandemic.
Government recommendations have asked people to limit travel and work from home. Schools have shifted to students learning from home and many businesses serving the public have been ordered to close.
From pedestrian traffic on Burlington’s Church Street to vehicle traffic on Vermont highways to airlines cancelling flights, all forms of movement and travel have been curtailed as the public works to help curb the spread of the virus.
Plans called for moving the new hotel to this parking area on the north side of the garage, with work to begin this spring. Now everything is on hold due to impacts from the COVID-19 virus on travel. Photo by Gabriella Marchesi
The airport has taken a hard financial blow. Revenues are falling quickly as the number of flights decreases nationally and the number of passengers using Burlington International decline.
“This is nothing like any of us have ever seen before,” said Gene Richards, the airport’s Director of Aviation. “It has virtually brought everything to a halt.”
In early March, before the spread of coronavirus, between 10,000 and 15,000 people deplaned at the airport a week, Richards said. Since March 20, that number has plummeted to about 100 people a day.
“I’m speechless. It’s hard to explain the hardship this is going to cause,” said Nic Longo, the airport’s Deputy Director of Aviation. “No one could have predicted the scale of this virus or its economic impacts.”
He described what comes next as a “trickle-down” effect: As the overall demand for air travel drops, airlines are slashing up to 70% of their normal traffic. They are limiting the number of flights per day, and in some cases, grounding entire fleets of airplanes, Longo said.
As a result, Burlington International expects to see a significant number of aircraft parked on site for the foreseeable future.
“It’s a good thing that people are listening to the mayor and the governor about staying safe and practicing social distancing,” Richards said. “But I am sad for our airport and the air travel industry that is taking a major blow because of this.”
The dramatic drop in air travel has airport officials rethinking plans for a July groundbreaking on the $15 million Fairfield Marriott hotel project.
“My gut feeling is that we will not break ground this summer,” said Richards. “If it’s feasible, we will move on, but we don’t have that foresight right now.”
Richards said that before construction moves ahead on the hotel, they want to make sure that the “economic engine” of Vermont is back up and running.
“We want to make sure that the hotels in the area are back up and running and full before we throw another hotel into the mix,” he said.
Richards did not offer an estimate of how far into the future the hotel groundbreaking might happen.
Impact On Airport Vendors
Meanwhile, airport officials are most keenly focused on the daily shift to adjust to the reduced level of traffic.
For example, Longo noted that the parking garage – usually a major source of revenue for the airport – has been hugely impacted.
At this time of year, the garage is usually filled to 93% capacity. By March 23, Richards said that number had fallen to just 5%.
“We are working through this the best we can,” said Longo, who like many airport staff began working from home March 16. “We have back-ups, reserve funds.”
Another example is rental car agencies. Revenue from those airport operators usually grosses $25 million a year.
“We won’t come even close to that this year,” Longo said, adding that one recent task was helping the rental companies find places to park all of the vehicles that won’t be rented out.
Other businesses operating at the airport are in similar straights.
“All of our vendors – the car companies, Skinny Pancake, Hudson News – have reached out to us to see if we can help through this,” Richards said. “We will do everything we can to help them survive.”
Hotel site adjusted
The consideration to delay construction on the proposed airport hotel comes just after project plans were adjusted to choose a new site.
In 2018, the original proposal for the 110-room hotel called for a five-story building at the south end of the parking garage. But in February, the FAA said a structure that size would interfere with the airport’s radar system.
To comply with FAA regulations, the project was redesigned to be built on the north side of the parking garage on a site now used as the oversized parking lot.
The location was the main change. The hotel will still be five stories with 110 rooms.
Richards said it may even be better for travelers, as this location will offer parking designated specifically for the hotel.
DEW Construction of Williston won the bid for the project which will be built and operated as a Fairfield Marriott and will include a restaurant and a bar, according to project plans.
The hotel project so far has not generated concerns from South Burlington residents in the neighborhood that abuts the airport.
Longo added that building a five-story structure between the neighborhood and the airfield may even be beneficial for residents because it may help block some airport noise.
Other Future Plans Unclear
In an interview in late February, Longo was bursting with excitement about the upcoming airport construction projects, saying they would help catapult the airport into a higher caliber facility for both travelers and the airlines.
“I’m not even sure our commissioners understand how all-encompassing these projects are,” he said at the time.
He was referring to broader plans to streamline operations at the main terminal in a way that would transform how the public uses the airport. One key project on the drawing board involves plans for a significant expansion to consolidate the two current TSA checkpoints -- one each on the first and second floors -- into one checkpoint on the first floor to screen all passengers.
This would require expanding the current building by 100 feet and the new area would become the new center of the airport terminal, Longo explained.
Because Burlington International is classified as a “small hub airport” by the FAA, it was not eligible for a terminal expansion grant, Longo said. Airport staff worked with representatives from Sen. Patrick Leahy’s office to override this protocol and ultimately received $10 million for expansion.
The funds will be available until 2021. Airport officials expected to seek bids for the contract by the end of March but the current economic situation given the travel disruptions related to the COVID-19 pandemic may result in this project also being pushed off, Longo said.
Finally, the airport was also scheduled to conduct a $300,000 parking garage maintenance project this spring that included a new roof. That contract was postponed on March 16 due to the response to COVID-19 in order to free up much-needed funds.
“I will take every opportunity I can to make [budget] cuts on things that are safe and won’t have adverse effects on our other tenants,” said Richards. “If the American public isn’t flying, then we will need to make changes.”
And so adjustments are likely to continue as the national and local public health and economic situation continues to evolve in the coming weeks and months. Airport officials say they have the long view in focus.
“Our number-one priority is always the passengers. Without the airport and the connectivity it provides, who knows what downtown Burlington, the schools or Chittenden County as a whole would be like,” Longo said, suggesting that the impact and recovery from the pandemic response will compare with the aftermath of 9/11 when the airline industry was hit hard. “This is going to look a lot like that,” he said.
But, just as the community -- and the economy -- recovered after that disaster, airport leaders say they believe a rebound will happen again and plans on the shelf will be ready to roll when conditions are right.
“We all have to stand up together through this,” Longo said. “I’ve told everyone, this hurts a lot. It will hurt a lot. It will hurt a lot for a while. But it’s not just you or me -- it’s all of us.”
You can find this story in Vermont Business Magazine.
