ACI-NA Air Cargo Conference March 26, 2008 Los Angeles, CA
Agenda Part I Part II Part III Major Trends Air Cargo Development Models Lynxs Group
Major Trends
Major Trends Developer s Perspective Considerable new growth (3-4x GDP) outside of North America, overall N.A. market flat with few isolated growth pockets Dislocated capital market Ongoing consolidation, both on customer and developer sides Privatization and commercialization of Airports, especially outside U.S. Spotty developer coverage in most global markets Approx. 1300 new cargo aircraft to be added by 2020, will drive need for corresponding ground facilities Global integrator expansion & global trade driving growth, but declining mail volumes and weak N.A. market Select N.A. redevelopment opportunities emerging at existing facilities, obsolescence and efficiency becoming a major factor
Major Trends Continued Need for new facilities solutions which are: - Less capital intensive - Greener - More efficient - Compliant with new security guidelines - Designed for connectivity with ground transport - More specialized, user requirements are not homogeneous Need for new solutions for new airline entrants (i.e. LCC s, VLJs, etc.) Increased focus on environmental impact considerations, including noise, traffic, and curfew constraints
Air Cargo Development Models
4 Cs Public Ownership Private Ownership Public Private Partnership (PPP) Third Party Development Privatization (Long Term Concession) Capacity - Master Plan - Timing - Right-sizing - Prioritization - Resources Control - Need vs Want - Effective vs Active - Duration - Governance Capital - Constraints - Opportunity Cost - Allocation - Leverage - ROC Cost - Efficiency - Total Occupancy Costs - Competitive Proposition
Capital Allocation 80/20 Rule Traditional Airport Model 3 rd Party Developer Model Cost Revenues 30% Airside Facility Lease 20% Revenues Ground Lease Ground Lease Aero Charges Aero Charges 70% Landside Apron/Parking Charges 80% Apron/Parking Charges Throughput Charges Cost Throughput Charges Service Charges Airside Service Charges 30% 80%
Third Party Development Developer Equity Airport Authority GL Payments Ground Lease SPV Lease Payments Lease Hold Estate Tenants Loan P&I Non-Recourse Financing
Public Private Partnership (PPP) Public Private Partnership Airport Authority Developer Equity Airport Authority GL Payments Ground Lease SPV Lease Payments Lease Hold Estate Tenants Loan P&I Non-Recourse Financing
Lynxs Group
Lynxs Group Air Cargo & Logistics International air cargo real estate development firm based in Austin, Texas 50/50 Joint venture company, backed by resources and capital of GECAS Full service real estate firm Development & Acquisitions Construction Management Leasing Property Management & Asset Management Growing Portfolio North America: 1.5+ million sq.ft., 12 properties, 3+ projects in pipeline EMEA: 1+ million sq.ft., 1 project underway, 2 projects in pipeline Latin America: 1 project to start shortly, 2 projects in pipeline Asia: 2H08 Strategic Focus New development Redevelopment & Refurb opportunities Acquisitions
Lynxs Air Cargo & Logistics Development Flexible Solutions Acquisition & Development - Build-to-Suit & Sale Leasebacks - Master-planning - New Construction - Redevelopment of obsolete facilities - Redeployment of Under-utilized Assets Property Management & Leasing - Property Management Services - Asset Management Services - Leasing Innovative Project Structures - Build Own Transfer (BOT) - Public Private Partnership (PPP) - Public Private Company (PPC) - Joint Venture (JV) Valuable Partner Exclusive Airport Focus - Domain knowledge - Promote Air Cargo Traffic - Tenant Relationships - On-Airport Development Expertise Financial Strength - Triple-A Credit Rating Long-Term Partnerships - Innovative Structures - Access & Accountability - Value-added Services - Credibility
For more information, please visit: www.lynxs.com