London City Airport receives a financial boost of £130 million through contributions from Canadian pension funds and Kuwait’s Wren House.
- As the airport contends with an ongoing decline in business travel following the pandemic, it strives to stabilise financially.
- Passenger numbers remain below pre-Covid levels, creating challenges for the airport’s recovery and future growth.
- Government restrictions hamper efforts to expand services, despite an increased passenger cap.
- The airport remains financially viable with support from long-term shareholders, yet challenges persist.
The injection of £130 million into London City Airport by a consortium of Canadian pension funds and Kuwait’s Wren House comes as a strategic move to address post-pandemic financial challenges. This capital is aimed at reducing debt and bolstering cash reserves, providing the much-needed financial stability to navigate refinancing discussions over £700 million loans due in March 2026.
Despite these financial reinforcements, London City Airport continues to face formidable challenges in passenger recovery. In 2023, passenger numbers stood at 3.4 million, significantly lower than the 5.1 million seen in 2019. Even with projections of 4 million passengers in 2024, this figure is still approximately 20% less than pre-pandemic levels. The airport’s reliance on corporate travel, which has been slower to rebound compared to larger airports like Heathrow, exacerbates these difficulties.
Efforts to boost passenger numbers are further stifled by government decisions, particularly regarding weekend service expansions. Although the annual passenger cap has been raised from 6.5 million to 9 million, achieving this new limit may prove challenging without additional weekend flights.
This financing marks another important phase in the airport’s history of ownership transitions. London City has seen significant changes, such as its sale by Dermot Desmond and subsequent acquisition by a Canadian-led consortium in 2016 for £2 billion.
According to a London City spokesperson, significant growth has been observed in leisure travel, now making up about 60% of the airport’s passenger profile. This diversification of passenger base indicates a shift in the airport’s market dynamics post-pandemic.
London City Airport’s £130 million financial injection aims to support its recovery amidst enduring post-pandemic challenges.
