Juneau airport weighs selling or leasing building it only recently learned it owns

The Juneau International Airport Board on Thursday will consider whether to sell or lease a building the airport only recently confirmed it owns, a discovery that came during closeout of its former Hertz lease.

Airport staff confirmed the ownership in the board's Oct. 8 agenda. "This was not previously understood," staff wrote. The building went up in 1969, was rebuilt in 1985 and was last renovated in 1997 by the tenant's contractor. It has been part of the leased premises since at least 1999.

Hertz's rental car concession at the airport ended Sept. 30. Hertz asked for one more month on its separate wash bay lease, which now runs through Oct. 31. Airport Manager Andres Delgado wrote in his report to the board that the extra month "will allow for an orderly closeout and transition while JNU evaluates future use of the building and underlying Airport property."

Staff laid out two paths. The airport could keep the building and lease it as-is to a new tenant, or sell the building and keep the land beneath it. A buyer would take on future maintenance, rehabilitation and improvements, and would sign a new ground lease with the airport.

Staff prefer selling the building through a competitive process. They wrote that it would reduce the airport's long-term maintenance and capital costs, encourage private investment and bring in sale proceeds along with ongoing ground-lease revenue. The airport would keep ownership and control of the land, as FAA requirements call for. Several parties have already expressed interest in buying the building or leasing it as-is, staff wrote.

The board will direct staff on which path to pursue; it is not a vote on a sale. Any sale would need approval from the City and Borough of Juneau Assembly. The board meets at 6 pm Thursday in the airport's Alaska Room and on Zoom. Residents who want to testify may contact Shannon Van Valin at 907-586-0962.

Staff are also preparing a possible request for proposals for the empty rental car counter in the terminal.