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Fairbanks companies who bet on Condor get money back

Posted: Tuesday, November 19, 2002

ANCHORAGE (AP) -- Small interest checks have been distributed to 15 Fairbanks businesses, organizations and individuals who pledged $100,000 to Condor Airlines to fly to the Interior city.

The investment, which some believed risky, has laid the groundwork for the German-based vacation airline to make stops in Fairbanks next summer.

The backers were handed their share of $734 in interest on Nov. 7.

''The sponsors are very pleased to have their cash returned, unblemished,'' said Dave Carlstrom, director of marketing at the Fairbanks International Airport.

Carlstrom, who helped spearhead the recruitment of the airline, invested some of his own money in the effort.

Carlstrom said the revenue for the airport from the airline through landing and fuels fees was minimal, somewhere in the $30,000 range.

''The payoff is to the community and the tourism businesses,'' he told the Alaska Journal of Commerce.

Condor carried passengers from Frankfurt to Fairbanks via Whitehorse, Yukon Territory. The airline ran once-a-week nonstop return flights from Fairbanks through Sept. 26.

Backers' money, put into an escrow account, guaranteed the number of passengers through the 19-flight season would be at least 950. Tourism officials said 1,154 people -- primarily returning German tourists -- boarded Condor in Fairbanks for the trip to Frankfurt.

Round-trip tickets ranged from $650 to $850.

Had the return flight not averaged 50 seats, Condor would have been compensated under the terms of the deal.

The Fairbanks Convention and Visitors Bureau put in $14,000 toward the pledge. Other businesses, including hotels, tour operations and fuel companies pledged at least $1,000 each.

''The community rallied -- it was just a great effort,'' said Deb Hickok, president and chief executive of the Fairbanks Convention and Visitors Bureau.

Although the checks averaged just a few dollars each, Hickok relished the fact no one lost money in the deal.

The airline began service last year to Fairbanks on a trial basis.

This past season showed an increase of 33 percent over 2001 for travelers arriving in Fairbanks, and a 14 percent increase for those returning to Europe, according to Fairbanks Convention and Visitors Bureau statistics.

The visitor's bureau will spend about $70,000 in the next few months promoting Fairbanks and the Interior to Germans, Hickok said.

Like Fairbanks, airports across the United States are wooing airlines with cash incentives to lure airlines to stop in their communities to spur economic development.

Carlstrom points to Portland, Ore. where several businesses ponied up $10 million recently to attract Lufthansa, which intends to offer a nonstop route to Europe.

He said Fairbanks, while successful with its Condor business, still needs to work to get airlines to the Interior's largest city.

''We're barely past the embryonic stage in market development right now but we are on the map,'' Carlstrom said.

Charles Hughes, Condor's North America vice president in Chicago, said Fairbanks is a good fit for his airline, which historically hauls Germans to warmer climes, like the Mediterranean, Cuba and the Dominican Republic.

''Condor has always been a beach-and-sand airline,'' Hughes said. ''This was a side of the market we hadn't explored before.''

Hughes said the airline has not yet decided whether it will ask for a financial guarantee next summer.



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