Doncaster Sheffield Airport: £20m loan to owner stalled after request to see its books

Peel Group this week made the shock announcement that a strategic review was beginning into the future of the airport, a move greeted with dismay across the region.

South Yorkshire’s Mayoral Combined Authority (MCA) had already made loans of £3.5m in 2018-2019 and a second loan in March 2020 of £5m.

A source told the Free Press they had been given a business case for the loan, which was to support DSA’s development, but wanted to see the books “so we could satisfy ourselves that there was a reason they were asking for the money.”

“They didn’t want to show us their accounts, that’s why this loan has stalled. We are not just here to offer cheap loans.”

The Government is coming under pressure to intervene, but says it is a “commercial decision” for the owners.

Conservative Don Valley MP Nick Fletcher suggested councils and the MCA could take a financial stake in the business. He cited Teeside Airport, which came back under public ownership in 2019 after Peel Airport’s majority shareholding was bought out. Accounts out on Friday showed it made an £11.8m loss in the past financial year.

South Yorkshire’s Mayor Oliver Coppard said he was “frustrated” with the way Peel had operated, and said the Government also had to get involved.

He said he believed the best people to run airports were private sector operators, adding: “The main company are a profitable, successful business and they should be doing everything they can to make sure DSA is a success going forward with the resources they have available to them.

“This is an issue that the Government has to get involved with.

“Obviously there will be local leadership, but we need a partner in Government who can work with us. If Grant Shapps isn’t going to stand up for the likes of Doncaster and South Yorkshire, what is the point of the levelling up agenda?”

The airport opened in 2005 after it was converted by the Peel Group from the old RAF Finningley airbase.

A statement earlier this week said the site may no longer be commercially viable, and blamed the ongoing impact of the pandemic and the “fundamental issue” of a shortfall in passenger numbers being exacerbated by base carrier Wizz Air pulling out.

Another source said they had been told the airport had been loss-making for 15 years, adding: “I was told Peel brought in an independent auditor, and without an injection of cash it was not looking good.”

Peel Group describes itself on its website as "one of the leading infrastructure, transport and real estate investors in the UK, with collective investments owned and under management of more than £5 billion". It was the developer behind the MediaCityUK site in Salford, built the Trafford Centre, and has wide interests in everything from housing, commercial to retail and leisure.

The company declined to make further comment.

A Government spokesperson said: “We recognise Doncaster Sheffield Airport’s announcement of a review into the future of the airport will be concerning for passengers and workers, and the Government is in close contact with the airport to understand its plans.

“While this will be a commercial decision for the owners of the airport, we hope they conclude after consultation with stakeholders that there is a viable aviation future for the airport.

"Regional airports are key in serving our local communities, supporting thousands of jobs in the regions and act as a key gateway to international opportunities. We will continue to bring forward our plans to level up and ensure the whole of the UK has the connections people need."