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Business

Breakthrough in Sight for Berlin Airport Project

Insiders say project-planning company PPS will take a major step towards constructing a new international airport for the German capital.

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The controversial project to construct a new international airport for the German capital, Berlin, looks set to take a major step towards realization this week.

On Friday, the project-planning company, PPS, decides whether it will accept an offer for the purchase and development of Schönefeld airport from an industrial consortium headed by German construction groups Hochtief and IVG. Handelsblatt learned from people close to the airport's shareholders that rejection of the offer is unlikely.

PPS will "remain in talks" with the consortium, these people said. This suggests that official negotiations proper will start to commence on the conditions for the development of the new Berlin-Brandenburg International airport (BBI) at the Schönefeld site in eastern Berlin. So far, talks have yet to go beyond the preliminary stage.

Hochtief chairman Hans-Peter Keitel, speaking to news agency vwd in Mexico on Monday, said that the talks would represent the last chance to reach an agreement on the project. He ruled out the possibility of the consortium's making further improvements to its existing bid.

Under the PPS's current plans, the Berlin-Brandenburg International airport (BBI) is to go into operation in time for the start of the 2007/08 winter flight timetable. But the consortium last autumn said it favored putting back the opening until 2011.

That's because the downturn in international air traffic following September 11 has meant that 2011 is now the year when the annual total of passengers using the new airport is now expected to hit 20 million, the number that's being used as the basis for current planning. The investment volume for the BBI project has been estimated at 2.7 billion euros.

In the last three months of 2001, passenger numbers for Berlin's three current airports, Tegel, Tempelhof and Schönefeld, totaled 12 6 million, some 15% down on the number seen in the last quarter of 2000. Turnover at the three airports was down 2.4% on the year at 4 million euros.

The news that the negotiations are set to continue will put paid to speculation that the government for Berlin city-state, a coalition between the Social Democratic Party and the post-communist Party of Democratic Socialism, plans to abandon the privatization of the city's airports. Consortium insiders have suggested that if that happens, they will claim for damages running into hundreds of millions of euros.

People familiar with the matter said that the PPS had received two variations of the consortium's bid – a purchase and a leasing offer – as a modification of the original bid presented in July 2001. The companies, which plan to construct the airport and run it as concession-holders, have said that without state participation the project won't be viable.

The Federal Audit Office and the audit offices of Berlin and Brandenburg only recently compiled confidential reports on the consortium's new offers, which have since been passed to the shareholders. The new offers were said to include a unit passenger charge of 5 euros, representing a considerable reduction from the DM16.80 (8.40 euros) originally planned.

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