Data & Research February 25, 2009

America's Most Expensive Airports

Before you traverse to Traverse City or shoot over to Charlotte, check out this list of America’s most expensive airports for domestic travel.
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Recent research by Forbes listed the 25 most expensive airports. Many of them might surprise you, as they are housed in medium-sized cities, mostly concentrated in the Midwest and Southeast.

Those of you who fly to the Cincinnati area are probably aware that better deals can be found north of the city in Dayton, or a couple hours away in Indianapolis, Indiana, or Columbus, Ohio. The Cincinnati/Northern Kentucky International Airport took the gold as the most expensive airport, with an average fare price of 48 cents per mile, according to Forbes. To put it in perspective, that’s three times the average cost of flying from two of the country’s cheapest airports: Florida’s Fort Lauderdale/Hollywood International Airport (16 cents) and California’s Long Beach/Daugherty Field Airport (15 cents).

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But, not so fast: Whether it was the bad press or a coincidental move to lower fares as airlines are seeing decreasing passengers, Cincinnati has lowered its fares since the Forbes article was published. The airport has long gotten away with higher fares because it is dominated by a Delta hub that shuts out competition. But Delta announced it will lower fares in the airport from 5% to 60%, according to news reports.

America’s Most Expensive Airports

Forbes used data from the Department of Transportation’s Origin and Destination Survey, which sampled 10% of all U.S. domestic commercial airline tickets from the third quarter of 2008. The other airports aside from Cincinnati in the top 10 of Forbes list are:

  • Cherry Capital Airport in Traverse City, Michigan (41 cents per mile)
  • Tri-Cities Airport near Johnson City, Tennessee (39 cents per mile)
  • Columbia Metropolitan Airport in Columbia, South Carolina (39 cents per mile)
  • Duluth International Airport in Duluth, Minnesota (38 cents per mile)
  • Greenville-Spartanburg International Airport in Columbia, S.C. (38 cents per mile)
  • Shreveport Regional Airport in Shreveport, Louisiana (37 cents per mile)
  • Yeager Airport in Charleston, West Virginia (37 cents per mile)
  • Douglass International Airport in Charlotte, North Carolina (37 cents per mile)
  • McGhee Tyson Airport in Knoxville, Tennessee (37 cents per mile).

In addition to Cincinnati, the only other large airport in the top 10 is Douglas International Airport in Charlotte. Forbes noted that it is another big hub in a medium-sized city (in this case, U.S. Airways), which means the hub carrier ends up with “massive market shares and prodigious pricing power.”

The good news is, if you find yourself on a U.S. Airways flight to Charlotte, you can spare your $2 for a soda: The airline just announced it’s bringing back its policy of giving out complimentary soft drinks starting on March 1, the Associated Press reported. Every little bit counts, right?

Deals & People February 25, 2009

Forward Absorbs, Assimilates Kensington Funds

Forward Management, LLC, investment adviser to the Forward Funds, will add the Kensington Funds from the Kensington Investment Group, Inc., to the Forward Funds series.
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According to a press release, the addition, pending shareholder approval in April, would create a combined fund family offering investors 35 mutual funds in no-load and load-share classes with more than $3.7 billion in assets under management. Following shareholder approval, Kensington Funds will be branded as Forward Funds.

After Match

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The Kensington Select Income Fund (KIFAX), the Kensington Global Infrastructure Fund (KGIAX) and the Kensington Strategic Realty (KSRAX), will maintain their investment strategies and continue to be managed by current portfolio managers.

Kensington’s Global and International Real Estate Funds (KGFAX, KIRAX) will merge to create the Forward International Real Estate Fund. The portfolio will continue to be co-managed by Paul Gray and Michael McGowan. Additionally, Kensington Real Estate Securities (KREAX) Fund will merge into Forward Real Estate Fund1 (FFREX/FPREX).

Forward Real Estate Fund was launched in 1999 and, according to the announcement, “has a solid, long-term track record of investing in U.S. real estate management companies using a core-focused approach.” The fund is managed by Richard Imperiale, a veteran of real estate investing. According to the press release, the management transition of these funds will bring additional expertise and resources that will allow Kensington’s real estate investment team to gain an increased focus on the international arena.

Third Acquisition

The acquisition of the Kensington Funds marks Forward Management’s third acquisition in the last year. Forward acquired Accessor Capital Management LP (Accessor), investment adviser to the Accessor Funds in 2008 (see “Forward Management Picks Up Investment Adviser’), as well as the assets of Berkeley Capital Management, LLC (Berkeley), including the investment portfolios and team responsible for managing the Global Dividend, International Dividend, U.S. Dividend and SmallMid Core Portfolios.

According to the press release, this transaction also will significantly expand Forward’s income/dividend-oriented product offerings. The Kensington portfolio management team will join the teams from Berkeley and Accessor, further strengthening Forward’s internal asset management capabilities.

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