Business Irish

Monday 11 December 2017

Aer Lingus tries to quit lease deals at airport

Aer Lingus: reportedly engaged in talks with DAA Photo: Bloomberg News
Aer Lingus: reportedly engaged in talks with DAA Photo: Bloomberg News

John Mulligan

Aer Lingus is believed to have engaged in talks with the Dublin Airport Authority (DAA) about relinquishing leases the airline holds on two buildings at the airport.

The Irish Independent understands that Aer Lingus and the DAA have been working on a deal that will result in Aer Lingus being allowed to terminate leases on the two buildings early without having to pay a cash penalty that could have run into millions of euro.

In return, Aer Lingus will have to hand back a lease, that they did not want to break, on land adjacent to the carrier's head office. It's understood that the DAA was interested in re-acquiring this land as it can be redeveloped at some stage in the future. Some sources have speculated the airline could have been forced to pay anywhere up to €10m to terminate the leases early unless it could come to another arrangement.

Aer Lingus is understood to have as many as 10 years left on leases for the two buildings.

One of the buildings is close to the Ryanair headquarters and was previously used by catering staff. It is not currently being used at all.

The other, known as the 'Tech Building' is adjacent to the existing terminal and is the Aer Lingus operations centre. It is used by staff including pilots and cabin managers. Aer Lingus said this week that it will be "de-layering" its cabin crew staff by eliminating cabin manager positions.

Aer Lingus inked a deal with the DAA before Christmas to lease the controversial Hangar 6 at the airport and the airline has made no secret of the fact that it wants to move many of its staff over to the facility, which has office space for about 350 people.

Lay-off

A spokesman for Aer Lingus said that the airline does want to move its operational staff to Hangar 6, which would reflect "best practice" within the industry. He could not confirm whether any talks have been held with the DAA regarding leases, but said in any event such discussions would not be made public.

Meanwhile, a spokesman for the DAA said he could not comment.

It is thought the airline held a very long lease on the land, while the carrier leases an estimated 16 acres of land in total at Dublin airport.

The airline already has more office space than it requires at Dublin airport, and following the lay-off of 670 of its workers under the current cost-cutting scheme, it will have an over-supply of space for its needs.

Irish Independent

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