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Airlines ink lease deals at Knoxville
Posted: August 22nd, 2008



Flexibility seemed to be the goal for several airlines that just concluded lease agreements at Mc-Ghee Tyson Airport.

And they got it, too, although not without some price.

The Metropolitan Knoxville Airport Authority board of commissioners met Wednesday afternoon and approved five-year lease and use agreements with Northwest, US Airways, Continental and Allegiant Air. The leases were fairly standard except for those signed with Northwest and Allegiant, as Bill Marrison, Airport Authority president, outlined for board members.

Northwest, which is in a pending merger with Delta Air Lines, received the same deal the Airport Authority gave Delta in July - a five-year lease with stipulations that would let the new airline renegotiate its space requirements if the merger goes through as expected.

The Airport Authority manages McGhee Tyson and Downtown Island airports for the city of Knoxville. Delta and Northwest have operated out of McGhee Tyson for years, leasing gates and ticketcounter space. The Airport Authority also receives revenue from the airlines from landing fees.

The leases signed with Delta and Northwest are designed to give them flexibility as they merge. According to the agreement, for 24 months beginning with the closing of the merger, the Airport Authority will cooperate with Delta and Northwest as they try to consolidate operations. The cost of any relocation or consolidation would be shouldered by the two airlines, though.

The board did not discuss fi nancial terms of the airline contracts.

Prior to moving in the renovated McGhee Tyson terminal in 2000, many lease and use agreements with airlines at McGhee Tyson were for 20 years or more.

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