Malaysia Airports to develop KLIA Aeropolis

Published: Monday, June 6, 2016

Malaysia Airports Holdings, the world’s second largest airport group by the number of handled passengers recently announced five partnerships and agreements to develop KLIA Aeropolis.

The company said at the launch of KLIA Aeropolis that it was aiming to turn an area of roughly 100 sq. km around Kuala Lumpur International Airport into an airport city which was expected to contribute 30 billion ringgit ($7.34 billion) to the nation’s gross domestic product over a 15-year period, excluding airport terminal operations.

KLIA Aeropolis will be developed around these three areas: air cargo and logistics; aerospace and aviation; and facilities for events and conferences and also leisure.

Malaysia Airports has signed deals with conglomerate DRB Hicom and low-cost airline AirAsia. The companies involved in the deals are in the air cargo and logistics sector, and in the aviation and aerospace sector.

DRB Hicom’s subsidiary, the aviation ground service provider KL Airport Services is allocated an extra 41,806 sq. m for its cargo operations at the site of the former low-cost carrier terminal which will now be converted into a cargo terminal.

AirAsia will be given space to build its regional distribution center within the cargo terminal for its low-cost courier and parcel delivery service, Redbox.

As part of the development of the airport city, Raya Airways, a cargo and ground handler, is teaming up with logistics company DHL Express and global air service supplier United Arab Emirates-based Dnata for its operations. It was a wholly owned subsidiary of the Transmile Group but was sold off and restructured before emerging as Raya Airways.

Raya Airways is planning a 100 million ringgit refurbishment to transform the old low-cost air terminal into a cargo facility to be completed in 2018, according to local paper The Edge Financial Daily.

Other partnerships were with Dutch airport logistics provider Vanderlande Industries to set up a regional distribution center and Swiss support company RUAG Aviation Malaysia to convert a part of Subang airport into a maintenance, repair and operations facility.

Malaysia Airports did not disclose the value of these deals.