City votes to demolish South Terminal, make room for other airport expansion

AUSTIN, Texas - The South Terminal, which opened in 2017, has been a big hit, alleviating a lot of the air traffic from the Barbara Jordan terminal at Austin-Bergstrom International Airport (AUS). 

But Thursday, the Austin City Council voted to begin the process of taking the building by eminent domain, and demolishing it.

"The South Terminal opened and low-cost carriers began operating there. Allegiant, Frontier and Sun Country," said Jeff Pearse, CEO of Lonestar Airport Holdings.

Lonestar Airport Holdings is the company that runs the smaller terminal. Pearse reached a 40-year lease agreement with the city back in 2015, but now he was shocked to learn, they have other plans.

"We were surprised to learn that the city wants to demolish the terminal. The city claims they need that real estate to develop taxiways," said Pearse.

This power would come from eminent domain. The airport says it is all part of their Airport Expansion and Development Program. They said in a statement:

"A vital component of the program is the development of the new midfield concourse, which necessitates the future closure of the south terminal. The department of aviation will continue to work with all business stakeholders and tenants throughout the duration of this program and looks forward to delivering an improved passenger experience to all AUS customers."

"We don’t see eminent domain as the appropriate remedy here. They are trying to use eminent domain not to recover real estate but to basically extinguish our business," said Pearse.

Pearce worries not only about his business, but the future of low-cost carriers at AUS. He worries that squeezing those carriers into the Barbara Jordan terminal could cause them to reduce their number of flights.

"If the South Terminal goes away, so does access to low fares. Competition in the Austin market will be impacted. That is something every visitor and resident should be concerned about," said Pearse.