Malaysia Airports Holdings Bhd (MAHB) is eyeing a total investment of RM1.3 billion on a regeneration project for Subang Airports as part of ongoing efforts to turn the airport into an aviation hub in the Asia-Pacific region.
KLIA Aeropolis Sdn Bhd head Randhill Singh (picture) said about RM300 million from the investment would be used to construct common infrastructure and amenities, while the remaining sum of RM1 billion will be channelled to develop facilities such as hangars, factories, maintenance, repair and operation (MRO), and worshops.
Randhill said the funding for the five-year project will be generated internally, via borrowings and partnership with industry players and real estate developers.
“The MRO facilities are for helicopter, light aircraft and business jets in Subang Airport. We will announce two MRO players under a few agreements that will be signed in the coming months.
“Upon completion, we will have about eight million sq ft (743,224 sq m) in additional capacity for airside, landslide and common infrastructure facilities,” he told reporters at a media briefing in Sepang yesterday.
Randhill said KLIA Aeropolis will approach a multidisciplinary consultant on its design and construction by the second half of this year.
He said the development will take place on MAHB’s existing land in Subang which spans a total of 250 acres (101.2ha).
About 25% or 60 acres of the land have been developed with new hangarage space, parking spaces, aero manufacturing facilities and MRO outlets.
“The airport area is currently congested and is running beyond its capacity. With the proposed expansion, we will have a holistic view to develop the entire area, including enhancing the runway capacity.
“The airport is designed to cater to only 1.5 million passengers per annum, but the traffic has reached up to three million passengers pre-Covid, almost double its original capacity.
“We have to prepare for the recovery for the airport to resume and with this plan, we plan to increase the capacity to receive up to five million passenger a year,” he said.
KLIA Aeropolis expects the expansion plan to generate a total of RM5 billion in economic output once the entire project is completed within the next five years.
It is also aiming to triple the workforce in the Subang Airport area from only 4,000 now to more than 14,000 ready jobs by 2026.
KLIA Aeropolis is MAHB’s subsidiary tasked to undertake land development for the airport operator’s network of airports nationwide.
MAHB expects a positive return and a payback period within the 10-year period for the whole development. “We have secured a 40% to 50% take-up rate for tenants within the entire development for both airside and landside,” Randhill said.
The Subang Airport currently houses over 60 aerospace and aviation companies involved in turbo prop, business aviation, helicopters, MRO (ATR Aircraft and business jets), aero-manufacturing and logistics.