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“The $9.5 billion project will be built in phases and will create more than 10,000 jobs, becoming the fourth major terminal project announced by the Port Authority as part of a complete transformation of JFK into a world-class airport worthy of New York and the region.” – Governor’s Press Office
Governor Kathy Hochul today announced that the Port Authority of New York and New Jersey has reached a revised agreement with The New Terminal One (NTO) – a consortium of financial sponsors – to build a 2.4 million square foot state-of-the-art new international terminal that will anchor the south side of John F. Kennedy International Airport. The $9.5 billion project will be built in phases and will create more than 10,000 jobs, becoming the fourth major terminal project announced by the Port Authority as part of a complete transformation of JFK into a world-class airport worthy of New York and the region. When completed, The New Terminal One will be the largest international terminal at JFK and aspires to be among the top rated airport terminals in the world.
“As we recover from this pandemic, I want to ensure that everyone traveling to New York has a welcoming and streamlined experience, and that New Yorkers have the modernized transportation hubs they deserve,” Governor Hochul said. “The time to get large infrastructure projects done is now, and I’m committed to getting JFK’s brand new Terminal One underway and completed as soon as possible.”
The Port Authority Board of Commissioners will vote on the proposed lease agreement at its meeting this Thursday. The full cost of the terminal will be privately financed by the NTO consortium which includes financial partners Carlyle, JLC Infrastructure, and Ullico. A joint venture of Munich Airport International and CAG Holdings is the operating and technical services partner to the consortium.
As part of the project, the Port Authority will undertake a number of infrastructure upgrades and improvements including roads, parking, and utilities including a new electrical substation. The New Terminal One will be built on the sites of the current undersized and outdated Terminal 1, the aging and obsolete 59-year-old Terminal 2, and the site of the former Terminal 3, which was demolished in 2013. Construction of the new terminal is scheduled to begin in mid-2022 and the first phase, including the new arrivals and departures hall and first set of new gates, is expected to open in 2026.
The project was initially scheduled to break ground in 2020.Due to the severe impact of the COVID-19 on air travel, the terms of the agreement needed to be restructured. The restructured deal announced today marks a major step forward in the ambitious plan to transform JFK into a unified, 21st century global gateway. The new terminal will be built in phases, subject to international passenger traffic levels, with full completion anticipated in approximately 2030.
The New Terminal One will ultimately have 23 new gates, as well as bright and airy check-in halls and arrival spaces designed to enhance the customer experience and compete with some of the highest-rated airport terminals in the world. Customers will enjoy world-class, New York-inspired dining and retail amenities, as well as space for lounges, an indoor green space and family-friendly amenities.The New Terminal One will incorporate the latest advances in both sustainability and security and be infused a with uniquely New York sense of place.
In October 2018, following a competitive review of leasing proposals, the Port Authority entered into exclusive negotiations for the development of two major new international terminals, one each on the airport’s north and south sides, that would lead the transformation of JFK and increase the airport’s capacity to accommodate projected growth.
Today’s announcement reflects a significant vote of confidence by the private sector in the future of JFK Airport, the return of air travel, and the economic recovery of the region. A key element of the restructured agreement is an extended lease term to 2060 to provide sufficient time after the terminal opens to enable the private investors recover their multi-billion-dollar investments. The City of New York’s ten-year emergency extension of the master lease for JFK Airport, which had been set to expire in 2050, enabled this important element of the restructured deal with NTO.
This week, the Port Authority Board will also vote on the authorization of
the full $2.9 billion of funds which were included in the Port Authority’s 2017-2026 Capital Plan for the JFK Redevelopment program. These funds are allocated to enabling infrastructure in direct support of JFK Redevelopment, including roadway improvements, utilities, improved parking facilities, a ground transportation center and airfield work. (To date, approximately $1.24 billion of those funds have been authorized through separate Board actions.) Thus, the Port Authority capital is leveraging private investment at a rate of more than 5:1 when taking into account the full private investment of more than $15 billion that has been committed to the four projects comprising the full JFK redevelopment program.
The development of The New Terminal One is expected to result in over 10,000 total jobs including more than 6,000 union construction jobs.
NTO is a private consortium comprised of Carlyle, JLC Infrastructure (formed in 2015 by Loop Capital and Magic Johnson Enterprises), and Ullico (the only labor-owned insurance and investment company), and is supported by Reach Airports, a joint venture between Munich Airport International and Carlyle’s airport platform, CAG Holdings, providing technical services. NTO selected a design build team, led by AECOM Tishman, and Gensler, a design and architecture firm.
JLC’s participation as a minority-owned equity investor in the project is notable not only in that it continues the state’s trend of MWBE firms creating wealth by investing in such a major public-private partnership – beyond the provision of goods and services such as construction contracts – but doing so at the 30 percent level, which is both historic and nation-leading.
The passenger facilities at The New Terminal One will feature significantly larger check-in, security and concessions areas with high ceilings, natural light and modern architecture coupled with interior green space, exhibits and art featuring iconic New York landmarks and local artists. World-class retail, restaurants and bars will include locally inspired restaurateurs, craft beverage options and Taste NY stores. Free, high-speed Wi-Fi and an abundance of charging stations throughout the terminal will enable passengers to stay connected at each step of their journey.
State-of-the-art technology will further improve the customer experience and security in the new terminal including elements such as touchless passenger journey, digital passenger flow and queue management, TSA security lanes featuring the latest technology, advanced video search analytics, biometric-based systems and a flexible design to accommodate future technology and/or regulatory changes.
Sustainability enhancements will include the use of renewable energy technologies such as a solar hot water, aircraft de-icing and fluid recovery, and the conversion of diesel ground service equipment to electric-powered ground service fleet across the airport – such as baggage tractors and belt loaders.
Plans for The New Terminal One build on the momentum of the other three major components of the airport’s transformation. The $3.9 billion development of a state-of-the-art new Terminal 6, to be built by JFK Millennium Partners, on the airport’s north side that will seamlessly connect with JetBlue’s existing Terminal 5 was approved by the Port Authority Board of Commissioners in August. The $1.5 billion expansion of Terminal 4, led by Delta and JFK International Air Terminal, was approved in the spring and will begin construction in the immediate future. Additionally, work began in December 2019 on the $425 million expansion of JFK’s Terminal 8, led by American Airlines, which operates the terminal, and British Airways, which will be relocating to Terminal 8 from Terminal 7, set to be demolished to make way for the new Terminal 6.
Port Authority Executive Director Rick Cotton said, “The Port Authority is committed to rebuilding and transforming our airports into the world-class facilities the region deserves. The New Terminal One project at JFK will deliver on that commitment. Today’s announcement loudly proclaims the confidence the private sector has in the future of JFK Airport and of our region. At the height of the pandemic, when JFK Airport was seeing an unthinkable two percent of its pre-Covid passenger volumes, we never lost sight of finding a path forward for this world-class terminal that aspires to be one of the best on the globe. We thank Governor Hochul for her strong support of big projects. And we thank our dedicated team and partners for the extraordinary effort to turn JFK Airport into a best-in-class global gateway that New York and the region deserve.”
Port Authority Chairman Kevin O’Toole said, “This agreement to build a new Terminal One at John F. Kennedy International Airport demonstrates the commitment of the Port Authority of New York & New Jersey and our private partners to deliver for our region through some of the most difficult times in our agency’s 100-year history. Moving forward with this state-of-the-art international gateway, and the extraordinary level of private investment it brings, will create thousands of good-paying construction jobs critical to our recovery from the pandemic, while building the foundation of economic growth for decades to come.”
JFK Airport is one of the region’s most powerful economic engines, supporting roughly 300,000 jobs that pay $16.2 billion in wages annually while generating $45.7 billion in yearly sales. Prior to the onset of the pandemic, the airport set a record with 62.6 million passengers in 2019.
Redeveloping JFK Airport in Lockstep with the Local Community
In 2018, JFK Redevelopment Community Advisory Council was formed. It is co-chaired by U.S. Representative Gregory Meeks and Queens Borough President Donovan Richards and composed of elected officials, community boards, business and nonprofit organizations, civic organizations, and clergy leaders from the targeted local communities of Southeast Queens, Southwest Queens, the Rockaways, and western portions of Nassau County. Since its inception, the Council has been working with the Port Authority to expand community outreach efforts and develop community-focused programs, ensuring that this ambitious project solicits ongoing feedback from local stakeholders and provides meaningful opportunities for local businesses, MWBEs, students, and jobseekers.
This includes programming to advance the Port Authority’s commitment to a 30 percent MWBE contracting goal in all categories of work, and a special focus on opportunities for local businesses across all aspects of the JFK Redevelopment program, including this terminal project, which will be built by union labor under a full project-labor agreement. Other community development initiatives prioritized by the Council focus on job opportunities and workforce development programs for local residents, small business outreach and development, and educational programming for local students.
The JFK Redevelopment Community Information Center opened in Jamaica, Queens in early 2019, providing easier access for firms looking for business opportunities, local residents in search of jobs, or neighbors seeking more information about the project.
Dr. Gerrard P. Bushell, Executive Chair of The New Terminal One said, “With the support of Governor Hochul and the Port Authority, we will deliver a world-class terminal, drive New York State’s nation-leading MWBE participation to new heights and help spur regional economic growth. We will also deliver on our multi-year commitment to community development in Southeast Queens, and an increase in the number of local jobs, educational programs and small business capacity building.”
Jim Reynolds, Managing Partner of JLC Infrastructure said, “Governor Hochul, Port Executive Director Rick Cotton and the entire Port team worked tirelessly to make this project happen because they are committed to providing real opportunities for all New Yorkers. The New Terminal One has shifted the paradigm for public-private partnerships by engaging the local community to deliver a world-class facility. It will serve as a model for large infrastructure projects across the country.”
Edward M. Smith, CEO of Ullico said, “We are one big step closer to realizing the promise of good jobs for hardworking Queens and regional residents. Through its partnerships with labor, commitment to apprenticeships and support for local community initiatives, The New Terminal One is creating opportunities for the hardworking people who build and operate JFK. We applaud Governor Hochul for her essential support in making today happen.”
New York City Mayor-elect Eric Adams said, “Our airports are our portals to the globe, and they must be welcoming, safe and representative of our dynamic, world-leading city. This massive investment in JFK Airport will modernize our most important port, improve the travel experience for flyers, and inject billions-of-dollars into our local economy. I commend the Governor and Port Authority on bringing together this historic infrastructure agreement.”
Congressman Gregory W. Meeks said, “I thank Governor Hochul and the Port Authority for coming to this agreement. As Co-Chair of the JFK Redevelopment Community Advisory Council, it’s been a pleasure working with the Port Authority to create thousands of jobs that benefit MWBEs and locally based enterprises. I commend Rick Cotton, the Executive Director of the Port Authority, for his leadership. When this transformation is completed, New York will be leading the world among international state-of-the-art 21st century airports.”
Queens Borough President Donovan Richards Jr. said, “I am so pleased the Terminal One project is moving forward and will soon bring a sparkling new international terminal to JFK Airport. The new Terminal One will be filled with economic opportunities for our MWBE firms and businesses and wonderful amenities that will make it such a welcoming place for international travelers arriving at and departing from ‘The World’s Borough.’ Many thanks to Governor Hochul and the Port Authority of New York and New Jersey for all their tireless work and partnership.”
Assemblywoman Stacey Pheffer Amato said, “I am so pleased to see that Terminal 1 will undergo a much needed transformation and will receive the investment needed to create a world class international terminal worthy of the Borough of Queens. We’re sending a message to all who visit that New York is bold, and that everyone is welcome here. It has never been more important to invest in our aging airport infrastructure, and I’m glad that Governor Hochul, the Port Authority, and the NTO group were able to come together. This project will provide much needed jobs to Queens, and opportunities for local vendors to bring that Queens culture to the ‘Front Door’ to New York City.”
Assemblymember Vivian Cook said, “I am ecstatic that this much needed infrastructure project is officially in the works. As one of the busiest cities in the world, New York City deserves updated travel infrastructure.”
Assemblymember Khaleel M. Anderson said, “This promising new agreement between the Port Authority of New York and New Jersey and The New Terminal One recommits to a modernized, unified, more efficient, and sustainable John F. Kennedy International Airport. A world-class airport for New York City is significant for our region as it advances equity for the surrounding neighborhoods of Southeast Queens. With JFK Airport located in the heart of our district, my goal as the state representative is to continue to drive down the extremely high rates of unemployment worsened by the COVID-19 pandemic by fighting to ensure the viability of MWBE commitments and contracts throughout the lifetime of construction. I look forward to working with Governor Kathy Hochul, my colleagues in elected government, the Port Authority, private developers, our local community, and the rest of the JFK Redevelopment Community Advisory Council to fortify the cornerstone of this redevelopment process — local hiring, entrepreneurship, and business development.”
Gary LaBarbera, President of the Building and Construction Trades Council of Greater New York said, “The plan for a new Terminal 1 at JFK International Airport will transform the facility into a world class transportation hub, while driving historic private investment into New York City and its working people with the creation of tens of thousands of middle-class careers during construction. We applaud Governor Hochulfor her leadership in advancing this monumental project and look forward to getting to work to build a best-in-class, world-renowned facility.”
Council Member-Elect Nantasha M. Williams (D-27) said, “As the former Community Relations and External Affairs Manager for the JFK Redevelopment program, I know that the JFK International Airport is not just a partner for the people of Queens, but for all New Yorkers and those in the Tri-State area. This investment in JFK’s Terminal One Airport shows Governor Hochul’s dedication and steady leadership in ensuring that we come out of this pandemic even better than before. I applaud the Governor’s and the New Terminal One commitment to JFK Airport and the communities of Southeast Queens and look forward to being a strong partner in ensuring that these dollars are spent efficiently with community at its core. Today we celebrate, and in the days ahead we continue to work diligently to bounce back better.”
Council Member I. Daneek Miller said, “Southeast Queens is the front door to the City for many international travelers, and it’s exciting that we’re set to have world-class investments right in our backyard. Most importantly, it is essential that we have a strong partnership for small and local businesses, as well as MWBE’s to be a part of this process. Community engagement is so vital for a project of this size, and we are thankful to all of the partners who have made this aspect of the project a priority.”
Council Member Adrienne Adams said, “The New Terminal One at JFK Airport will enhance the traveling experience for New Yorkers and visitors alike, stimulate our local economy, and provide important opportunities for small businesses, residents, and students. I look forward to seeing the impact and benefits of this transformative project as New York City recovers from the COVID-19 pandemic.”
Justin Rodgers, interim president and CEO of the Greater Jamaica Development Corporation said, “The New Terminal One is an exciting opportunity for southeast Queens. We are ready to support the Governor and the State as they look for qualified businesses to support this massive infrastructure initiative.”
Kathryn Wylde, President & CEO, Partnership for New York City said, “The developments at JFK illustrate how Governor Hochul is accelerating the modernization of the region’s transportation infrastructure, utilizing public-private partnerships to ensure these major improvements are completed on time and on budget. This is a model for how she will leverage the new federal funding programs to upgrade the state’s aging infrastructure.”
Carlo A. Scissura, President and CEO of the New York Building Congress said, “For New York to remain competitive we must create good jobs by building 21st Century infrastructure. Governor Hochul’s announcement today will do exactly that. This renewed agreement will transform JFK into a world-class airport that will be the envy of the nation. We applaud Governor Hochul for continuing to invest in New York’s infrastructure and for recognizing the jobs and opportunities that doing so creates.”
Dr. Berenecea Johnson Eanes, President of York College/CUNY said, “This is great news and we look forward to continuing to partner with JFK Airport to provide training, employment, and internship opportunities for our students and the community.”
Thomas J. Grech, President & CEO, Queens Chamber of Commerce said, “This investment in John F. Kennedy International Airport will have a transformative impact on Queens and the entire region, improving a vital piece of our transportation infrastructure, creating jobs and catalyzing economic activity that supports our local businesses. Queens is proud to be the aviation borough, and our business community will continue to rely on our airports to support our economic recovery. On behalf of the 1,400 member businesses of the Queens Chamber of Commerce, I applaud Governor Hochul and the Port Authority on this exciting announcement. The Queens Chamber will continue to lead the effort to assist and place MWBE businesses into this project.”
John Caravella Esq., is a construction attorney and formerly practicing project architect at The Law Office of John Caravella, P.C., representing architects, engineers, contractors, subcontractors, and owners in all phases of contract preparation, litigation, and arbitration across New York and Florida. He also serves as an arbitrator to the American Arbitration Association Construction Industry Panel. Mr. Caravella can be reached by email: John@LIConstructionLaw.com or (631) 608-1346.
This is a general information article and should not be construed as legal advice or a legal opinion. The content above has been edited for conciseness and additional relevant points are omitted for space constraints. Readers are encouraged to seek counsel from a construction lawyer who has experience with Long Island construction law for advice on a particular circumstance.
Long Island Construction Law does not own this content. This content was created by the Governor of New York’s Press Office.