Outreach Presentation

INDIANAPOLIS INTERNATIONAL AIRPORT

CONCESSIONS & RETAIL OUTREACH SEPTEMBER 19, 2016

Agenda  Welcome and Introductions  IND Overview  Terminal/Campus Optimization Program  The IND Traveler  Diverse Business Participation  Business Opportunity  What’s Next?  Questions  Networking 1

WELCOME AND INTRODUCTIONS

The IND Team Mario Rodriguez Executive Director

Shannetta Griffin Senior Director of Planning and Development

Holli Harrington Director of Supplier Diversity

Marsha Stone Senior Director of Commercial Enterprise

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IND OVERVIEW

TERMINAL/CAMPUS OPTIMIZATION PROGRAM

Terminal/Campus Optimization Program  Evolve the Airport Travel Experience  Understand the Customer of Tomorrow  Enhance an Indy Sense of Place  Celebrate the Indy Spirit  Drive Local Economic Impact

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What is Indy?

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Enhance an Indy Sense of Place Indianapolis International Airport  Gateway to Indianapolis  Reflect the City’s Culture Guiding Principles for Sense of Place  Authenticity  Discovery/Surprise  Delight

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THE IND TRAVELER

IND Passenger Demographics  Generational Data • 39% Baby Boomers (1946 – 1964) • 30% Generation X (1965 – 1980) • 31% Millennials (1981 – 2000)

IND Visitors

 54% have college or graduate degrees  40% report household income >$100K  55% leisure travelers Sources: 2015 ACI ASQ Survey & 2015 QSM Survey

Boomer

Gen X

Millenial

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Evolution of Indianapolis Resident  Indianapolis is getting younger  Millennials and Gen Z population will grow to 65% by 2040  Ethnic diversity is increasing  Highest rate of growth in those identifying as two or more races  Hispanic/Latino – 2nd highest growth rate

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Our Evolving Traveler

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DIVERSE BUSINESS PARTICIPATION

POLICY: The Indianapolis Airport Authority (IAA) values diversity and is committed to providing meaningful opportunities to Disadvantaged, Minority, Women and Veteran Business Enterprises (DMWVBE). It is the policy of the IAA to implement measures to increase the participation and utilization of DMWVBE’s in Authority contracts and their respective subcontracts issued in relation to airport related services and purchases, including but not limited to construction, professional services, goods and concessions.

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ACDBE Program Participation of Disadvantaged Business Enterprises in Airport Concessions The United States Department of Transportation (USDOT) requires every airport that receives federal grants to maintain a Disadvantaged Business Enterprise Program. The program for airport concession DBEs (ACDBE), is mandated by Title 49 Code of Federal Regulations part 23 (49 CFR 23).

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Purpose of the ACDBE Program The Program Intent:  To ensure nondiscrimination in the award and administration of concession opportunities  To create a level playing field on which ACDBEs can compete fairly for concession opportunities  To ensure that only firms that fully meet ACDBE eligibility standards are permitted to participate  To help remove barriers to the participation of ACDBEs in concession opportunities

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Who Can Qualify as an ACDBE? Only firms organized for profit are eligible §26.73(d) To qualify as an ACDBE, a firm must be:  An existing small business, as defined by Small Business Administration (SBA) standards  At least 51% owned by socially and economically disadvantaged individuals who: • • • •

are US citizens or permanent residents possess expertise in their field control the daily business operations Have a personal net worth less than $1,320,000 21

Business Opportunities for ACDBEs  Food and Beverage Concessions  News & Gift Concessions  Specialty Retail Concessions  Services Concessions  Goods and Services Supplier  Management/Joint Venture

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Key ACDBE Program Facts  ACDBE is not the same as DBE, MBE, WBE, VBE, or SBE  Indiana Department of Transportation (INDOT) administers ACDBE certification for IND  You must be certified as an ACDBE to participate in Airport Concessions Disadvantaged Program

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ACDBE Application and Contact Information INDOT DBE Staff  Derrick Casson, Certification Manager 317-233-4664 or [email protected]

 Kimberly Sons, DBE Certification Specialist 317-234-8087 or [email protected]

 Sean Howard, Supportive Services 317-233-4944 or [email protected]

 Sissy Guynn, Supportive Services 317-233-4664 or [email protected]

For certification information and application, please visit the Indiana Department of Transportation’s DBE/ACDBE web page: www.in.gov/indot/2748.htm General questions can be emailed to: [email protected] 24

BUSINESS OPPORTUNITY

Indiana’s Largest Airport  > 8 million travelers each year  > 140 daily flights  43 nonstop destinations

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Serving Most of Indiana (and Beyond)  Only 7 miles to downtown  1.8 million residents in Indy metro  Primary service area population >3,000,000  Approximately 2 hour drive time

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Non-Stop Growth: More Passengers

Thousands

YTD Departing Passengers 2015 vs 2016 5.7 Million Passengers YTD

450 400 350 300 250

Biggest June in IND history

200 150 100 50 0 Jan

Feb

Mar

April 2015

May

June

July

Aug

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Non-Stop Growth: More Destinations  Alaska Airlines begins serving IND • Seattle

 Frontier and Allegiant add destinations • Jacksonville • Philadelphia • Savannah

 Vacation Express begins seasonal service • Punta Cana

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Non-Stop Growth: More Capacity  12% increase in total seat capacity Thousands

 Competitive mix of low cost and legacy seats

Seats Added 350 300 250 200 150 100 50 0 Legacy Carriers Low Cost Carriers 30

Robust Competition Benefits IND Travelers

22%

3% 33%

4% 23% 1%

14%

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Economic Engine for Central Indiana  > $4.5 billion annual economic impact  > 10,000 jobs  #2 largest FedEx operation in world  Nation’s eighth-largest cargo facility  No local taxes used for airport operations

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IND – Best Airport in America  ACI Airport Service Quality Award Best Airport in North America 2010, 2012, 2013, 2014, and 2015

 ACI Director General’s Roll of Excellence  Condé Nast Traveler Best Airport in America 2014 and 2015

 Travel + Leisure Top 10 Best Domestic Airports, 2016

 TripAdvisor Travelers’ Choice Favorite US Airport, 2016 33

IND – Best in Airport Concessions  ACI Excellence in Airport Concessions Best Food & Beverage Program, 2016

 Airport Revenue News Best Overall Concession Program 2009, 2011, 2012, 2013, and 2015

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IND Concessions Program Locations by Category 16 27 3

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Food & Beverage News & Gift Services Specialty Retail Actual lease packaging and space configurations/availability TBD 35

Historical Sales 1.5% Annual Growth 3.0% Annual Growth 3.2% Annual Growth

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Historical Sales per Square Foot

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Historical Sales per Departing Passenger 0.3% Annual Growth

1.8% Annual Growth 2.0% Annual Growth

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Comparative Airport Food & Beverage Concessions 2014 Sales per Departing Passenger $9.00 $8.00 $7.00

Median SEP = $6.05

IND SEP = $6.93

$6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $0.00

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Comparative Airport Retail Concessions 2014 Sales per Departing Passenger $7.00 $6.00 $5.00 $4.00

Median SEP = $3.40

IND SEP = $4.19

$3.00 $2.00 $1.00 $0.00

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Leases Are Expiring Locations Expiring by Year

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4 2 36

2017

2018

2023

2025

2020

Actual lease packaging and space configurations/availability TBD 41

Doing Business at the Airport: A Different Environment  Customers Not Here to Shop or Dine  Security  Airline Operations  Scaling Up  Small Spaces  Operating Hours  Operating Costs  Delivery/Storage  Employee Badging 42

Local Success Story Erin Humphreys EnRoute Spa

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Local Success Story Kim Hendren Nature’s Table Copper Moon Coffee Granite City Au Bon Pain

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Local Success Story Carly and Mandy Swift Just Pop In

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WHAT’S NEXT

Our Schedule Event

Anticipated Date*

RFP Workshops and Networking

2017 Q1

Issue RFP

2017 Q2

RFP Due Date

2017 Q2-Q3

Tenant Concession Awards

2017 Q3-Q4

*All dates are tentative and subject to change

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What to Do Next: Learn About Opportunities  Begin Networking – Today  Continue Networking – Utilize the Outreach Sign-In Sheet  Follow Us on Social Media Indianapolis Airport Authority @IAA_business Indianapolis Airport Authority

 Attend RFP Workshop and Networking (2017 Q1)

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What to Do Next: Take Advantage of Time  Start Certification • Contact INDOT

 Start Business Planning • • • •

What Is Your Concept Plan an Approach Arrange Financing Start Designing

 Start Thinking About Your Proposal • • • •

Describe Your Experience How Will You Manage ACDBE Participation Plan Why Are You Best for IND

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QUESTIONS

THANKS FOR YOUR INTEREST