Heathrow press releases

24 June, 2010

Heathrow's capital investment plan published

BAA today publishes its investment plans for Heathrow Airport in its annual capital investment plan (‘CIP’).

The annual capital investment plan (‘CIP’) is part of Heathrow’s normal business cycle. It takes into account the views of Heathrow’s airlines on major investment decisions and progress against programme milestones.


In the year to 31 March 2009, around £780 million was invested in Heathrow Airport.

The main projects were as follows:

•Construction of a tunnel to send baggage between Terminal 5 and Terminal 3

•Continued work on Terminal 5C – the second satellite building of the Terminal 5 complex due to be completed on-time in 2010

•The £46 million purchase of the old control tower, the last part of land in the central terminal area that was not owned by BAA and is key for future development plans

The total amount being invested at Heathrow over Quinquennium 5 (the five year period that began on 1 April 2008) is approximately £4.8 billion in 2008/09 prices. This represents one of the largest construction programmes in the UK and will support thousands of high value jobs in a depressed economy. The key project over this period will be the construction of Terminal 2A (formerly Heathrow East) and its satellite Terminal 2B which will replace the current Terminal 2. Terminal 2A’s facilities will be of equivalent standard to Terminal 5, independently recognised as one of the best airport facilities in Europe.

Completion of this investment programme will deliver world-class infrastructure and transform the customer experience at Heathrow, with around 70% of passengers using new or recently constructed terminals (Terminal 2A and its satellite in addition to Terminal 5). The remaining 30% of Heathrow’s passengers will be using Terminals 1, 3 and 4 which will have been extensively refurbished.

The relocation of British Airways to Terminal 5 was completed in October 2008, later than originally planned. As a result, BAA and the airline community have agreed revised relocation dates for airlines, revised timing of the phasing of various individual projects within the overall programme and the deferral of some capital expenditure. As a result revised delivery dates for certain projects within the overall CIP for Quinquennium 5 have been agreed with the airline community including bringing Terminal 2A and its satellite into operation from early 2014.

The current expected phasing of capital expenditure over Quinquennium 5 including actual expenditure in the year to 31 March 2009 expressed in 2008/09 prices is set out below based on the broad project groups used in the 2008 regulatory settlement.*

Investment on construction of a possible third runway and sixth terminal at Heathrow is not addressed in this year’s document** but is expected to become a key focus of CIP documents in future years. As a result, there are no detailed capital expenditure forecasts included in the document beyond the year to 31 March 2013.

The full Heathrow 2009 capital investment plan document is available at the Document centre section of the Investor centre.

* Whilst the overall expenditure over Quinquennium 5 has only changed to be expressed in 2008/09 prices rather than the 2007/08 prices used in the CAA regulatory settlement, spend has been transferred between the broad project groups from that shown in the settlement to reflect changes in how individual projects are managed and in the scope of project groups. ** PSDH refers to the development of additional runway and passenger terminal capacity at Heathrow and should be interpreted in the light of the UK Government decisions on same made during January 2009. The expenditure on PSDH relates to activities such as the planning application process and necessary land purchases.

For further information:

Media enquiries
Malcolm Robertson, Deputy Director of Group Communications: +44 (0)20 8745 7224
Damon Hunt, Group Head of Media: +44 (0)20 8745 7224

Investor enquiries
Andrew Efiong, Head of Debt Investor Relations: +44 (0)20 8745 2742

Mike Smith or Don Hunter: +44(0)20 7251 3801


Heathrow Airport media centre
Heathrow Airport
Email: media_centre@heathrow.com
Telephone: +44 (0)20 8745 7224