Cornwall Council and Cornwall Chamber of Commerce Roundtable Consultations - Cornwall Airport Newquay

Virtual Town Hall Event - Consultation 12th September 10:30 - 11:30am via MS Teams - 

Virtual town hall event ref airport-20240912_103358-Meeting Recording (vimeo.com)

Cornwall Council and Cornwall Chamber of Commerce Roundtable Consultation on Cornwall Airport Newquay
 
Time and Date: 13:30 13^th September 2024
 
Location: Aerohub
 
Chair: John Brown, CEO, Cornwall Chamber of Commerce
 
1. Welcome and Introduction
 
Chairperson:
John Brown, CEO of Cornwall Chamber of Commerce, opened the meeting, welcoming attendees and introducing the agenda, which focused on the strategic development of Cornwall Airport Newquay and its surrounding land, with an emphasis on economic growth and sustainability. It was made clear that each participant had the opportunity to ask a question or put forward a comment or recommendation with a further follow-up. If time allowed, further discussion could take place. It was also made clear that there may be some questions that are unable to be answered due to ongoing commercial discussions.
 
2. Attendance
 
Attendees:
 

• John Brown – CEO, Cornwall Chamber of Commerce (Chair)
• Mike King – Cornish Lithium
• Simon Tanner – CBRE
• Glenn Caplin Grey – Cornwall Council, Service Director for Economy and Skills
• Gary Lewis – Adynaton LLP
• Cllr. Louis Gardner – Economy Portfolio Holder, Cornwall Council
• Cara Bogus – University of Exeter
• David De Massey – Kenwyn Investments/Fairbairn Capital
• Kate Wild – Wild Card Communications & Chamber of Commerce Board Representative
• Andy Snapes – Built Environment Professional & Chamber of Commerce Board Representative
• Richard White – Adynaton LLP/Westcore
• Sam O’Dwyer – Cornwall Airport Limited
• Lawrence Palk - Wildanet

 
3. Overview of Discussion
 
3.1. Airport’s Strategic Importance and Financial Support
 
               •             Glenn Caplin Grey (Cornwall Council):
Highlighted the airport’s significance as a key infrastructure asset, receiving a circa £4 million annual subsidy from Cornwall Council. Significant capital investment is required to maintain its Civil Aviation Authority (CAA) license. The council’s strategy is to attract inward investment and ensure long-term sustainability, minimising the financial burden on taxpayers.
 
CBRE has been advising Cornwall Council on consolidating the portfolio to create opportunities for capital investment and economic growth, ensuring operational viability and expanding the economic impact of the airport.
 
3.2. Land Use Blueprint
 
               •             Glenn Caplin Grey:
Presented the land use blueprint, which excludes housing and focuses on industrial and commercial development. Key areas of focus include:
               •             Expansion of the spaceport to include R&D and manufacturing.
               •             Development of facilities such as hotels, logistics hubs, data centres
and energy hub, amongst other uses
               •             Aircraft maintenance and storage in the West Zone
               •             Gary Lewis:
Explained the development plan, which involves the relocation of the terminal and enhancement of airport facilities to support growth. There was emphasis on maintaining continuous connectivity and maximising the potential of the spaceport.
 
3.3. Viability and Economic Challenges
 

• David De Massey:
  • Raised concerns about the high costs of commercial construction in Cornwall, questioning the viability of such developments given the region’s low returns. He also asked about long-term financial risks, including the possibility of repossession if the development failed.
• Richard White:
  • Explained the need for a long-term capital provider from the likes of Oxbridge Colleges combined with potential short-term financing solutions from Westcore to build a critical mass. Richard confirmed that the deal is structured as a long-term partnership and details of what happens should a default occur are yet to be determined.
• Lawrence Palk
  • Questioned the viability of making money from the airport, given the high fixed costs and low passenger numbers.
• Sam O’Dwyer
  • Responded that the airport will never break even without significant diversification and additional revenue streams due to the size of the catchment area and high fixed costs.
• Andy Snapes
  • Enquired as to whether there was a breakeven number for passenger numbers
• Sam O’Dwyer
  • Responded that the airport would require a throughput of 1.5m passengers. Currently it has around 450,000 with only half attracting aeronautical charge.
• Cllr Louis Gardner
  • Confirmed that it’s a regular question from Council around whether the airport could be viable on its own. He reiterated the required drive growth in both passenger numbers and retail spend and to achieve that would again require significant capital investment that Cornwall Council is not able to inject into the project.

 
3.4. Connectivity and Economic Growth
 

• Mike King:
  • Stressed the importance of airport connectivity for Cornish Lithium’s operations and its potential for future geothermal heat supply. He emphasised that improved connectivity would be vital for attracting businesses and driving economic growth in the region.
• Richard White:
  • Made clear that the continued operations of the airport was vital to the project.
• Mike King:
  • Enquired as to the relationship with the Ministry of Defence (MoD) and whether that was and will continue to be positive.
• Cllr Louis Gardner:
  • Confirmed a strong and ongoing relationship with the MoD and with continued servicing of military flights.
• Cara Bogus:
  • Reiterated the need for continuous connectivity and the importance to University of Exeter of having regular public flights to and from the airport.
• John Brown:
  • Confirmed that some of the regular concerns received through Chamber members was around the ambiguity of the red line concerning the airport and that it required tightening up and greater specificity to ensure it was made crystal clear that the airport would remain open to the public and connectivity was to be improved.
• Richard White:
  • Confirmed again that continued connectivity of the airport was paramount for the business plan and it would be detrimental not to expand operations and suggested tightening up the red lines alongside the Council.
• Sam O’Dwyer
  • Underlined the need for guaranteed continuous connectivity, with a focus on increasing flight frequency, terminal growth and enhancing regional transportation links.
• Cllr Louis Gardner
  • Highlighted that the original red lines were approved by Scrutiny Committee and it would have been inappropriate to change them at this stage but they will be refined further throughout the process to provide more clarity on connectivity.

 
 
 
 
3.5. Public Transport and Accessibility
 

• Cara Bogus
  • Raised concerns about the accessibility of public transport to the airport and called for improved connectivity, particularly in relation to the proposed mid-Cornwall metro project and new bus links.
• Cllr. Louis Gardner:
  • Confirmed that there are plans to improve public transport access to the airport, which would benefit both the airport and its surrounding developments.

 
3.6. Political and Financial Risks
 

• Andy Snapes:
  • Expressed concern about the viability and affordability of development in Cornwall, noting that construction costs in the region are 15-20% higher than in places like Manchester. The challenge lies in securing sufficient funding to cover both infrastructure investment and revenue-generating projects and that developers in Cornwall have historically struggled to make such projects financially viable.
• Richard White:
  • Pointed out that supply constraints and cost inflation are nationwide problems, driven by three main barriers: a difficult planning system, limited land availability, and the need for financial returns. He noted that Cornwall has advantages in terms of Local Development Orders (LDOs) and the availability of land. But the economic viability remains a challenge which is why there is a need for a long-term approach and gradual development to create critical mass, especially focusing on aeronautical demand. He called for collaboration and support from stakeholders.
• Cllr Louis Gardner
  • Highlighted the significant financial pressures facing Cornwall Council regarding the airport, stating that if no action is taken, the airport could close in the near future due to a lack of funds.
• Kate Wild
  • Highlighted the need for strong relationships with the government to secure national support for the airport. She warned that ongoing negativity and criticism of the airport’s development could jeopardise its future and urged for a united front to present the airport’s case on a national level to prevent its closure. She suggested there was opportunity for national government engagement and introductions on back of central interest in lithium, FLOW and geothermal industries in Cornwall.
• Glenn Caplin Grey
  • Reiterated the importance of the Public Service Obligation (PSO) flight route subsidy and the need for continued government support to ensure the airport’s economic sustainability.
• John Brown
  • Expressed concerns about political instability in Cornwall, particularly with the upcoming May elections. They questioned why the project hasn’t been fully scrutinized or “had the tyres kicked” at full council, suggesting a lack of thorough review might leave it vulnerable to future political shifts.
• Cllr. Louis Gardner
  • Highlighted the decision-making path is dictated by Cornwall Council’s standing orders, which classify it as an executive decision, meaning it goes through cabinet rather than full council. He emphasised that all councillors have had multiple opportunities to attend meetings, access documents, and speak on the matter. While acknowledging that not everyone agrees, he explained that despite the challenges and potential personal backlash, he is pursuing this project out of responsibility as the Cabinet Member for Economy and as a local resident.

 
3.7. Long-Term Partnerships
 

• David De Massey
  • Highlighted that there are commercial opportunities underway and would like to pick-up discussions with Adynaton LLP/Westcore on these opportunities
• Richard White:
  • Confirmed to pick up conversations and meet with anyone wanting to discuss commercial opportunities regarding Cornwall Airport Newquay and the estate
• Richard White
  • Stressed the importance of developing long-term partnerships with local businesses to ensure that the airport’s operations are viable and sustainable in the long run. He reaffirmed the commitment to keeping the airport operational and ensuring that the mixed-use development benefits the local economy.

 
4. Conclusion and Next Steps
 

• Richard White
  • Thanked participants for their valuable input and reiterated the need for ongoing local collaboration and support.
• Glenn Caplin Grey
  • Invited further engagement and consultation with stakeholders on the development and land use blueprint, including via the consultation on the ‘Lets Talk’ part of the Council’s website.
• Cllr. Louis Gardner
  • Highlighted the importance of the airport for Cornwall’s local economy and emphasized the need for a long-term strategic approach to its development.
• John Brown
  • Thanked all participants for a healthy debate and discussion and agreed that the minutes would be shared and published on the Cornwall Chamber of Commerce website along with links to the public consultation forum

 
The meeting was adjourned at 14:42.
 
Minutes Prepared by:
John Brown, CEO of Cornwall Chamber of Commerce