DIA Dreams: Aviation director Kim Day plans to take DIA where no airport has gone before
Before the late-night jokes about the baggage system, before the opening-day snowstorm and the seven-hour breakdown of the train system on Black Sunday, and long before the 9/11 attacks changed the way people fly, Denver International Airport was already full of surprises — not all of them pleasant.
Curt Fentress remembers going out to the site when it was Colorado's largest and most astounding construction zone. Piles of dirt were heaped everywhere. Ziggurats of dirt, more than a hundred million cubic yards of the stuff. Enough, one flack calculated, to bury 32 city blocks a quarter-mile deep.
"There were thousands of people working there," Fentress recalls. "It was dangerous going around, because the roads changed every day. There were different paths because of the grading process, and you really had to watch out. They had EMT groups standing by, waiting to pick up anybody who might get injured. It was already getting to be a city in itself."
Fentress and his then-partner, Jim Bradburn, had been brought in to design the airport's terminal late in the game, after Mayor Federico Peña had rejected a ho-hum terminal proposal from another architect. Peña wanted the Fentress-Bradburn firm to give the city something distinctive, something "memorable" — "like the Sydney Opera House," he told Fentress.
The new team gave Hizzoner more than he bargained for: a tepeed fever dream on the prairie, its sweeping, Teflon-coated fiberglass roof suggestive of the peaks beyond, the expansive interior bathed in natural light. The Jeppesen Terminal would soon become one of the most recognizable (and beloved, according to an American Institute of Architects poll) new public buildings in the country, launching Fentress on a career filled with accolades and distinguished iconic projects, including airports from Korea to Qatar.
And the airport it serves — once the source of hooting and derision among the locals, over everything from its swollen price tag (which soon doubled, from $2.5 to $5 billion) to its godforsaken location, 23 miles from downtown Denver — has emerged as one of the state's most critical assets. With an estimated $22 billion annual impact on the local economy, 30,000 on-site workers and 140,000 passengers a day, Denver International Airport is, as Fentress put it, "a city in itself" — and one that's left an indelible mark on the city next door.
Peña had run for office on the campaign slogan "Imagine a Great City." More than anything else the brash young mayor achieved, DIA managed to put flesh on those words, declaring Denver's intention to compete on a global scale — and paving the way for a new ballpark, a new stadium and other public-works projects.
"The difference between the city when that slogan came out and today is incredibly dramatic," Fentress says. "DIA gave a lot of people in the community the confidence that we can build these things."
The quest for a new airport to replace increasingly cramped Stapleton International had occupied local politicians for years, culminating in two public votes in the late 1980s that cleared the way for annexation of land and financing. After months of further delays tied to an automated baggage system that devoured bags, DIA opened on February 28, 1995. It was a shaky start, marred by technical glitches and some of the highest operational costs in the country, a result of the many concessions granted to woo United Airlines while Continental retreated. The paucity of foreign flights led one New York Times wag to sniff that "Denver's airport is international in name only."
The trains broke down. The runways cracked. And the baggage system kept disemboweling luggage, much to Jay Leno's amusement. The system was ultimately scrapped, but not before United and the city had spent ten years and close to $700 million trying to salvage it.
The airport celebrates its fifteenth anniversary this week with few reminders of that bumpy takeoff. DIA has become the fifth-busiest airport in the country and the ninth-busiest in the world. It's consistently ranked in business travelers' surveys as one of the best airports in North America, and Travel + Leisure recently declared Jeppesen Terminal among the world's most beautiful facilities.
Despite widespread turmoil in the airline industry, an implacable recession and increasing security demands, Denver's big tent continues to post impressive numbers. As United's dominance has been challenged by Frontier and Southwest, local ticket prices have dropped while revenues have soared. DIA recorded more than fifty million passengers in 2009, only a 2 percent drop from the previous record year, while other major airports were reporting traffic down 10 to 20 percent. Yet that success carries its own price tag; the airport is approaching its original design capacity sooner than anticipated, prompting a flurry of expansion plans.
Kim Day, DIA's manager of aviation, believes the airport is uniquely positioned to adapt to growing traffic, in part because of the remote location its detractors have always complained about. The airport sits on 53 square miles of sheer potential. It has room for half a dozen more runways, with few neighbors to complain about them, while other, hemmed-in airports are spending billions on protracted battles with adjacent communities over expansion issues.
"We have so many physical advantages," Day says. "JFK has limited land, LAX has limited land. Their gateways, in particular, are very constrained. They will cap out at some point in time, while we could well move up in market share."
Hired two years ago at an annual salary of $240,000 — double her predecessor's pay — Day is a former head of the Los Angeles airport system, and thus keenly aware of the political baggage that can bog down airport operations. Her ambitious plans for DIA amount to a full-scale transformation rather than an upgrade, including a long-awaited hotel, a light-rail station and other improvements that will cost the airport close to a billion dollars to achieve. She's already spent hundreds of thousands of dollars on consultants and studies to address everything from the airport's "organizational culture" to what kind of brewpubs and wi-fi amenities young techies want while stuck on a layover. And she's now in the lengthy process of revising the airport's original master plan, a bold rethinking of where new concourses and even a second terminal might go, in response to a rapidly changing aviation environment.
"Our plan is to stay nimble," she says. "We don't know how much expansion we're going to need or when. We do know that, for the first time in the history of this airport, we're facing some major maintenance issues. It's like the Golden Gate Bridge: You'll never be done, but there are things we probably need to do that we haven't even thought of yet."
To date, Day's plans for DIA have attracted surprisingly little blowback. Last summer, a few city council members fretted over the lack of specifics in a proposed $160 million contract with Parsons Transportation Group, the project management team for the hotel and rail station, but the contract sailed through. Some were skeptical about the selection of Santiago Calatrava as the "signature architect" for the station project and wondered if the airport could afford more "memorable" buildings, but Calatrava is still on board. Day maintained that the project could be accomplished without a noticeable hike in airline fees; her own chief financial officer disagreed — and was put on "investigatory leave" for months.
The greatest uproar, though, has been in response to the idea of relocating security operations in the terminal to what is now the ticketing area, possibly making the Great Hall — the tent, the light, the spectacular views — closed to all but ticketed passengers. Day says the proposal was misunderstood and is being studied further.
The larger goal, she says, is to make sure the airport adapts to the way people fly these days, adding amenities and technological innovation for passengers, coming up with more efficient ways to handle baggage and security, developing additional revenue streams — and keeping ahead of the competition.
"The potential here is endless," she insists. "The visionaries that bought the land and laid out the airport — I can't say enough about the people who bucked the odds and made this happen, and the community that got behind it. This is really the best investment the region has ever made. We're trying to take it to the next level."
Technically, Denver International Airport isn't a city in itself, but an agency of the City and County of Denver. Yet it operates unlike any other city entity, like an estranged nephew with his own bankroll.
The decisions of DIA's aviation manager aren't subject to the same sort of scrutiny from above as other, more earthbound municipal operations. The airport's contracts with private companies aren't subject to city council approval unless they exceed $500,000. And although there is some degree of oversight by the city auditor's office — which recently blasted DIA for handing out $10.7 million in fuel tax rebates as "subsidies" to airlines, an alleged violation of state law — the airport has its own healthy revenue stream and daunting debt load, entirely separate from the city's own budget.
In 2008, DIA raked in a record $540 million from landing fees, facility charges, parking and car rentals, concessions and other operations. But deduct its operational expenses — including such items as salaries and snow removal, runway maintenance projects and a unique arrangement with its main tenants, in which DIA splits the first $40 million in certain revenues with the airlines — and that half-billion figure drops by two-thirds. Factor in depreciation costs, and DIA actually reported a net loss in operating income in 2008, as it has in most years. And that doesn't even begin to account for the $330 million in principal and interest DIA now pays each year on $4.1 billion in outstanding bond debt, which has been restructured several times over the past few years.
Even saddled with all that debt, DIA is considered one of the best-managed airports in the industry. "The real story of the last two years is that, despite everything that's happened in the economy, we've stayed healthy," Day says. "Our expenses are less than our revenues, and every year we put money away and share revenue."
Yet Day, like many aviation managers, is looking beyond the troubled airline industry for future growth. In recent years, major airports around the world have sought to boost "landside revenues" through elaborate makeovers: higher-end concessions and even entire shopping malls inside the complex, development deals with hotels and mini-convention centers. Day hasn't ruled anything out but insists, "Every project we do, we look at in terms of return on investment."
Last year DIA hired a squad of management consultants, at a cost of $428,000, to organize a series of focus groups and other events designed to "increase the likelihood of achieving the airport's vision." Day had "town hall" meetings with virtually every DIA employee. The point, she says, was to help "change the culture here, to get people to realize that we are a competitive entity and that cost is their responsibility. To get them to change from what I would call a typical public-agency mentality to 'Hey, we're a business.'"
One critical piece of business that Day has nudged forward is the development of a hotel south of the terminal. Plans for an airport hotel date back to the early days of DIA but had been shelved repeatedly because of design and financing issues; private companies balked at the hefty construction costs and insisted they couldn't make the kind of return they expected on a 500-room property so far from the city.
Long before Day took over at DIA, the hotel concept had evolved into an enterprise the city would build and own, contracting with Starwood Hotels and Resorts (Westin's parent company) to operate it. The latest proposal calls for a 2015 opening of the hotel, along with an RTD light-rail station and an open-air plaza above the station. This isn't the first time Denver has partnered with a hotel chain to get the job done — public financing was used downtown for the Adam's Mark (now Sheraton Denver) expansion and to develop the 1,100-room Hyatt at the Convention Center — but skepticism about the profitability of a high-end airport hotel remains high.
Naysayers have predicted astronomical room rates and high vacancies. Day counters that the airport's own feasibility studies indicate the property will be seeing positive returns by its fourth year. "I think we can create a new business," she says. "We can get people from all over the country to fly in here — we're three hours, max, from just about any place in the country — and hold their business meetings here. They don't have to go downtown. This is a model we see all over the country."
Day regards an on-site hotel as a needed amenity for business travelers. Combined with the light-rail system, she also sees it as a possible attraction for locals who aren't even catching a flight but might want to explore the hotel spa or microbrewery: "This could create what I would call an urban space here at DIA."
In a recent op-ed piece, Jim DeLong, DIA's first aviation manager, questioned whether the rail system will attract as many DIA-bound passengers as predicted, in light of low ridership figures for similar systems at other airports. Day expects the system will receive strong patronage from airport employees and vendors, particularly in snowstorms, a selling point she's used in promoting the station to the airlines.
"Are they thrilled that we're paying for a train station? Honestly, no," Day says. "But it's something the FAA supports, and it's something that will benefit their employees as well as ours. Better transportation in bad weather helps the entire airport operate more efficiently."
DeLong, who left DIA in 1998, concedes that the rail line will probably be a hit with airport workers. "But you've already got all manner of transportation to the airport — RTD, limousines, taxis," he notes. "It's going to cost $1.4 billion to build that line all the way out to DIA, and if people do ride it, it's going to be at the expense of all the companies out there that pay taxes and are trying to make a living."
Both the hotel and the train have strong support from Denver's political leadership. But last summer, Day's effort to win city council approval for a contract with the California-based Parsons Transportation Group to manage the project hit some turbulence. It wasn't just the size of the contract — up to $160 million over seven years — but the lack of dollar amounts that could be tied to specific phases of the development that had some councilmembers scratching their heads.
"I do like to know what's going to happen before I approve expenditures," says councilwoman Jeanne Faatz. "I didn't want to authorize the entire amount without even knowing what the plan was."
Faatz points out that Day was willing to start with a smaller contract, for $95 million, to be spent chiefly on hotel construction and overall design work. But other councilmembers decided to go for the entire package, over Faatz's opposition. DIA officials say they're still months away from releasing preliminary designs showing how the new hotel and station will look. Yet what details did emerge from the council discussion raised other concerns, too.
One reason for DIA's economic success has been the relentless whittling away of its landing fees, so that the average "cost per enplanement" (CPE) has dropped from $16.85 in 1995 to about $10.50 in 2009. That makes the airport a more attractive stop for carriers such as Southwest, which, in turn, helps to keep airfares low for the consumer. But the costs associated with the hotel-station project and related road and bridge work — pegged at $750 to $950 million — combined with other capital improvement projects for which DIA is issuing more bonds, are expected to send the CPE up, up and away; one recent consultant's report predicted that Denver's CPE would top $15 by 2015.
Stan Koniz, DIA's chief financial officer, apparently ran the numbers, too, and warned Day that the project could imperil the airport's bond rating. In October, the Denver Post reported that Koniz had been put on paid leave for alleged "insubordination." Koniz recently returned to his post, and Day declines to discuss the flap, calling it a personnel matter. But she insists the airport isn't going to risk its relationship with the airlines over the project.
"We are benefiting from the low costs the airlines have to operate here," she says. "If we raise their costs, they'll leave and you'll have higher tickets and fewer options."
Another tidbit that surfaced in the council discussions had to do with modifications to the existing terminal, including a possible "sterilization" of the Great Hall, now mostly occupied by security lines. Online ticketing and boarding passes, do-it-yourself check-in stands and baggage fees that discourage passengers from checking luggage have dramatically reduced the amount of space needed by the airline ticket counters at DIA. Day suggested that the Transportation Security Administration scanning process could move to the ticketing level, leaving the Great Hall reserved for ticketed passengers — and presumably opening up opportunities for more retail and restaurant business in the area.
Critics of the plan say that it would hurt vendors by denying non-ticketed visitors access to most of the terminal, when few passengers spend much time or money in the terminal anyway. "Making the whole thing sterile doesn't make sense," declares aviation consultant Mike Boyd. "Nobody's going to hang in the Great Hall, three concourses away from their flight. We get out of there and as close to the airplane as we can, and then we hang on by our fingernails until we can board. Nobody comes back."
Boyd believes the "shopping mall" concept some airports are pursuing is a dubious one, for several reasons. Arriving passengers don't spend money at the airport, departing ones don't want to buy more than they can carry, and people making connections tend to stay near their planes. "It's hard to get people to go to the airport and spend money," he says. "I'm going to buy a hot dog and a magazine, but I'm probably not going to buy a sweater."
Day insists that the idea of relocating the TSA staff has been misinterpreted. "The goal wasn't to create non-airline revenue," she says. "It will, but that wasn't the goal. The goal was to get that security function out of the Great Hall and return it to what it should be. It was probably the best public space in any airport in America."
Her team is still exploring several options for the Great Hall, including some that could allow more public access at different times of day or set up more than one type of screening process. "We'll be going through lots of public workshops, and we'll get lots of input and show them lots of options," she says. "We've already got TSA to agree that they will work with us on this."
That's welcome news to Faatz, who believes more public input is needed before DIA proceeds with big changes. "I want to be sure the little guy is heard," she says.
Public meetings last spring over proposed changes to DIA's master plan were, for the most part, poorly attended. Boyd, an inveterate critic of DIA's operations, says airport leadership is more inclined to listen to its own consultants. "Whatever DIA wants to do with the Great Hall, they'll have studies up the wazoo saying how great it's going to be," he predicts.
Yet Day's team has also spent well into six figures over the past year on passenger surveys, focus groups, demographic profiles and other consumer studies in an effort to figure out what the public wants at DIA, from check-in conveniences to food preferences. Day says the surveys didn't reveal any startling surprises; passengers want more local brands and greater quality in goods (though they wouldn't say no to Denny's, either).
The airport's "catchment basin" has a population that is a bit more affluent and flies more frequently than the average found in other parts of the country. "Our passengers are getting a little younger, and they're much more high-tech," Day notes.
The travel experience for those passengers, Day says, could be quite different in five years than it is today. They might check bags at Union Station, board the light rail — and not see their luggage again until they deplane in Paris or Tokyo. They could track their bags with their phones, similar to package tracking now offered by services such as FedEx, or receive text messages from the airline advising them of any flight delays, or use their downtime in the airport to access DIA's souped-up website, which would guide them to the closest microbrew.
It all sounds lovely. It might even happen sooner rather than later. But Day says the important thing is to stay nimble, to prepare for whatever might be coming. She still has pieces of the old United baggage system in her office, a reminder of what happens when you bank too heavily on a future that isn't quite ready to arrive.
When those passengers of tomorrow hop on the light rail, they will cross Peña Boulevard on a bridge designed by Santiago Calatrava and pull into a train station that is also (to use the brand name) a Calatrava. Nobody knows yet exactly what the station and connecting bridges will look like, but they will undoubtedly be dramatic, emotionally engaging works of art, because everything Calatrava designs is dramatic, emotional and iconic.
The Spanish sculptor-engineer, hailed by the New Yorker as "the most crowd-pleasing architect since Frank Gehry," is best known for his bridges and stations, though he's also in great demand for "signature" high-rises and art museums. Yet he's also been criticized for being "too sculptural," for costly or impractical designs that emphasize drama over function; his expansion of the Milwaukee Art Museum, for example, has been described as a work of public art rather than a place to exhibit art. Denver has its Libeskind signature statement; Milwaukee has its Calatrava.
The selection of Calatrava for the station design has unsettled some city leaders. The abrupt departure in 2006 of another signature architect, Steve Holl, from Denver's Justice Center project left a bad taste that lingers even today for councilman Charlie Brown, who wonders how Calatrava's vision will mesh with the present terminal.
"Some of my concern has to do with the huge egos these guys bring with them," Brown says. "How can you build a train station that doesn't interfere with what's already there architecturally? I do think that's a legitimate issue. But Kim swears by this guy."
Day, who has an architecture degree herself, says that Calatrava will serve as the project's "overall architectural guru, to make sure that all of the mapping and the architecture works together." She's confident that the Calatrava design won't detract from what Fentress has already wrought at the airport.
"The first time Santiago Calatrava came out here, we drove out to where the blue mustang is and looked back at the site," she says. "He said to me, 'I understand the tent. I respect it. I will do nothing that will take away from it.' I am very confident that he gets it. I think we picked the right architect to come up with something that will be complementary and not overwhelming."
Even if Calatrava's work proves to be a great fit with the Jeppesen Terminal, it will still represent a significant departure from the airport's original master plan, which called for additional concourses to be built to the north while the terminal is extended south, where the hotel and station are now going to be built. One reason for the original expansion scheme has to do with the airport's weakest link, its trains — not the light-rail line, but the underground people-mover system that takes people to and from the concourses.
Except for the bridge to Concourse A, the trains are the only way passengers can reach their planes; planners ruled out aboveground connections between the other concourses in order to allow the planes more room to taxi and get back in the air quickly. As passenger traffic increases in the next few years, the trains will be operating at capacity; the only way to add more cars is to extend the current line farther south in order to create a "turnaround" point — and possibly another area where passengers can board or disembark from the trains in an expanded terminal.
DIA is still planning to extend the train line, if not the terminal, to the south. But judging from presentations Day has made in recent months, the new regime expects the trains to play less of a role in long-term expansion. Building additional concourses to the north would be expensive and disruptive to airside operations, the reasoning goes, ultimately requiring another train loop and creating long travel times to the outlying concourses. Alternative plans place the new concourses flanking the terminal on the east and west or even south of the hotel development, with a bus shuttling back and forth.
It's not known yet which scenario will prevail, but DIA spokesman Jeff Green acknowledges that the internal discussion is leaning away from the original plan, even though the new approach would involve some upheaval in roads and existing parking. "Our preferred alternative focuses on concourse expansion to the south, which doesn't rely on the train system at all," Green says. "Our first priority — after expanding the existing concourses — would be to grow to the south and take the passenger train out of the equation."
A few months ago Curt Fentress wrote a guest commentary for the Denver Post urging more public involvement and transparency in DIA's evolving expansion plans. He's kept clear of the controversy since, busy with projects elsewhere, from the Colorado Judicial Complex to a $1.5 billion international terminal that broke ground last week at LAX, Day's old stamping grounds. But he still looks at Jeppesen Terminal with the fondness of a prodigy's parent.
"I'm very pleased with the way it's turned out," he says. "The way the building has performed, the way the daylight comes through. It's a very sustainable building. It's been an icon for the city, and I'm very proud of my firm's contribution to that. My hope for the future is that, as it grows, it's done in a very thoughtful and public way. It's the crossroads by which Denver will live or die, in a sense."
One concept for DIA's future postulates a second terminal to the south, focusing on an expected boom in international flights. Attracting international carriers has been an elusive dream at DIA since its opening; the "international-in-name-only" airport lost one of its few daily non-stops to Europe in 2008, when Lufthansa canceled a Munich-Denver route after a mere eighteen months of operation, blaming the struggling economy. But Day is confident that the Munich flight will return and that a new generation of wide-body, fuel-efficient jets, led by the Boeing 787, will spark fresh opportunities for DIA — including a non-stop to Tokyo by 2012.
"Our future is the 787," she says. "It's the right size for our airport and can travel long distances. That plane will make Tokyo happen. We've been approached by Copenhagen and Paris. That plane opens up the world for us."
Day envisions a time when hyper-efficient, monster airships can travel from Asia, overfly L.A. and touch down on DIA's extra-wide runways, delivering passengers to connecting flights to destinations across the fruited plain, while flights from South America snub Dallas or Atlanta for Denver's megahub. With so many crosswinds in the industry and other airports reaching their expansion limits, economically and physically, why shouldn't DIA become the country's fourth-busiest airport? The world's eighth-busiest? Seventh?
Day doesn't see why not. For an airport that can stay nimble, there's nowhere to go but up.
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