City of PhoenixPhoenix Sky Harbor International Airport

Financial and Parking Overview

Jay DeWitt, Deputy Aviation Director

May 22, 2017

2

The Phoenix-Mesa-Scottsdale MSA –A Vibrant Urban Area

Phoenix is the 6th largest city in the U.S. based on population; 1.6 million residents(1) reflecting a 59% increase since 1990

12th most populous metropolitan area in U.S. – 2015 population estimate of 4.6 million residents(1)

Phoenix has sufficient water supplies for the next 100 years and beyond

Phoenix is a top tier convention and tourist destination

Intel plans to invest more than $7 billion to complete advanced semiconductor factory, creating more than 10,000 long-term jobs in the Phoenix area(2)

Sources: (1) U.S. Census Bureau, Population Division, Release Date: March 2016; (2015 Estimates) (2) Intel Website News Release, “Intel Supports American Innovation with $7 Billion Investment in Next-Generation Semiconductor Factory in Arizona” (February 8, 2017)

3

Air Service Is Critical for Phoenix MSA

Geographic location of Phoenix results in a high reliance on airline travel

Road miles from the Airport to:

Las Vegas 292

Los Angeles 371

Albuquerque 477

Salt Lake City 656

Denver 809

Dallas/Fort Worth 1,069

4

O&D Driven Traffic Growth

Sources: City of Phoenix Aviation Department; U.S. DOT, Air Passenger Origin-Destination Survey, reconciled to Schedule T100.

59% 59% 59% 59% 61%

41% 41% 41% 41% 39%

20.28 20.24 20.52 21.49 22.06

-

5

10

15

20

25

FY 2012 FY 2013 FY 2014 FY 2015 FY 2016

Mill

ions

Annual Enplanements

O&D Connecting

The Airport’s FY2012-2016 CAGR is healthy

FY 2012-2016 CAGR

Total Enplanements 2.1%

O&D: 3.2%

Connecting: 0.5%

5

A Stronger Hub: Two Primary Carriers Provide Competition

American Airlines is the world’s largest airline and the Airport is the 6th largest hub in its system American and Southwest accounted for 82.1% of enplaned passengers

Sources: Note:

City of Phoenix Aviation Department; U.S. DOT, Air Passenger Origin-Destination Survey, reconciled to Schedule T100.Percentages may not add up to 100%, as they are rounded to the nearest tenth of a percent.

American Airlines49.7%

Southwest32.4%

Delta6.4%

United4.9%

Alaska1.7%Frontier

1.1%WestJet

1.0%All Other

2.9%

FY 2016 Airline Market Share

O&D Resident

27.9%

O&D Visitor33.5%

Connecting38.6%

FY 2016 Enplanements

58.9% Total O&D

61.4% Total O&D

6

Note: Numbers may not add to totals shown due to rounding; percent change calculated based on unrounded numbers.

Sources: City of Phoenix Aviation Department; U.S. DOT, Air Passenger Origin-Destination Survey, reconciled to Schedule T100.

O&D Traffic Growth Remains Strong as Connecting Traffic Has Declined

Enplaned passengers decreased in the last quarter of FY 2016 and first two quarters of FY 2017

Declines were driven entirely by a reduction in connecting traffic by American and Southwest

Originating passenger demand remained strong, experiencing year-over-year growth of 5 to 8% over the past 6 quarters

By type of passengerFiscal Year Originating

Quarter Resident Visitor Total Connecting Total2016 6,147 7,391 13,538 8,517 22,056

Jul-Sep'15 1,509 1,351 2,860 2,508 5,368Oct-Dec 1,506 1,871 3,378 2,068 5,445Jan-Mar'16 1,396 2,279 3,675 1,881 5,557Apr-Jun 1,736 1,890 3,626 2,060 5,686

2017Jul-Sep'16 1,621 1,468 3,088 1,983 5,072Oct-Dec 1,624 1,968 3,592 1,767 5,359

Year-Year % Change2015-2016 6.9 5.8 6.3 (2.7) 2.6

Jul-Sep'14-15 6.6 7.7 7.1 6.8 7.0 Oct-Dec 6.2 5.3 5.7 (1.0) 3.1 Jan-Mar'15-16 7.3 4.1 5.3 (4.7) 1.7 Apr-Jun 7.5 6.9 7.2 (12.0) (0.7)

2016-2017Jul-Sep'15-16 7.4 8.7 8.0 (20.9) (5.5) Oct-Dec 7.8 5.1 6.3 (14.6) (1.6)

7

PHX’s Solid Financial Results

($000's) FY 2014 FY 2015 FY 2016RevenuesLanding Area $46,674 $52,082 $54,954 Terminal Area 130,489 127,641 129,242Ground Transportation 121,250 127,039 130,764Interest 1,807 1,842 3,092Other 29,704 31,129 27,275Total Revenues before Reimbursement 329,924 339,733 345,327Transportation O&M Expense Reimbursement (1) 13,626 14,488 14,837Total Revenues $343,550 $354,221 $360,164

Expenditures

Personal Services 104,683 105,760 105,591Contractual Services 105,687 105,198 108,376Supplies 11,159 11,092 11,686Equipment/Minor Improvements 3,034 4,115 4,583Total Expenditures (1) $224,563 $226,165 $230,236

Net Revenues Available for Debt Service $118,987 $128,056 $129,928 Total Senior Lien Debt Service 50,030 48,732 48,775

Senior Lien Bond Coverage 2.38x 2.63x 2.66xTotal Aggregate Debt Service 51,634 50,336 52,737

Total Senior and Junior Lien Debt Service 2.30x 2.54x 2.46x

Aggregate Debt Service Coverage (Revenue Method) 1.70X 1.82X 1.78X

(1) Rental Car Center Transportation O&M Expenses as defined in the CFC Bond Documents are included as cost of M&O.

Parking Overview

9

Parking Facilities Inventory

10

GENERAL (long term, ADA, misc.)

SHORT TERM

TOTAL VEHICLE SPACES

TERMINAL TWO 2201 0 0 0 2,201TERMINAL THREE 1,818 56 0 0 1,874TERMINAL FOUR 6298 297 0 0 6,595

SUB-TOTAL TERMINAL SPACES 10,317 353 0 0 10,670WEST ECONOMY LOT 1368 0 0 0 1,368EAST ECONOMY LOT 9527 0 0 0 9,527

SUB-TOTAL ECONOMY SPACES 10,895 0 0 0 10,895TOTAL PUBLIC SPACES 21,212 353 21,565

GENERAL PARKING

CITY SPACES

RENTAL CAR MEDIA TOTAL SPACES

44TH STREET 2,246 0 0 0 2,246T4 RAC 558 9 19 5 591

T4 LEVEL 9 453 0 0 0 453SOUTH AIR CARGO 396 0 0 0 396

SUB-TOTAL AIRLINE/TENANT SPACES 3,653 9 19 5 3,686TERMINAL 3 306 11 11 0 328

FACILITIES COMPLEX 205 0 0 0 205OPERATIONS LOT 108 12 0 0 120

POLICE LOT 87 0 0 0 87SUB-TOTAL COP EMPLOYEE SPACES 706 23 11 0 740

TOTAL EMPLOYEE SPACES 4,359 32 30 5 4,426

25,991

FACILITY NAME

TOTAL ALL SPACES

EMPLOYEE PARKING SPACES

SKY HARBOR AIRPORT PUBLIC AND EMPLOYEE PARKING SPACES

PUBLIC PARKING SPACES

Parking Facilities Inventory

11

Revenue by Facility

12

Revenue by Year

July $6,590,242 $7,087,735 $7,033,768

August $6,042,054 $6,536,819 $6,584,081

September $6,021,897 $6,407,452 $6,709,103

October $6,733,278 $7,152,767 $7,228,832

November $5,567,954 $6,062,354 $6,109,237

December $5,740,108 $5,964,225 $5,914,631

January $5,412,725 $5,706,830 $5,715,235

February $5,260,446 $5,585,465 $5,425,264

March $6,357,998 $6,504,429 $6,709,422

April $6,176,430 $6,401,157 $6,104,814

May $6,629,360 $6,914,721

June $6,827,582 $7,139,102

Totals $73,360,074 $77,463,056 $63,534,386

FYE 2017FYE 2015 FYE 2016

13

Revenue by Space

Spaces 2,201 1,874 6,595 1,368 9,527

Jul-15 374,278.00$ 170.05$ 369,555.00$ 197.20$ 3,345,417.00$ 507.27$ 165,069.00$ 120.66$ 2,833,416.00$ 297.41$ 7,087,735.00$

Aug-15 351,683.00$ 159.78$ 372,635.00$ 198.84$ 3,152,409.00$ 478.00$ 137,180.00$ 100.28$ 2,522,912.00$ 264.82$ 6,536,819.00$

Sep-15 343,169.00$ 155.92$ 333,407.31$ 177.91$ 3,112,890.00$ 472.01$ 146,660.00$ 107.21$ 2,471,326.00$ 259.40$ 6,407,452.31$

Oct-15 388,548.00$ 176.53$ 348,793.00$ 186.12$ 3,496,654.00$ 530.20$ 152,148.00$ 111.22$ 2,766,624.00$ 290.40$ 7,152,767.00$

Nov-15 368,988.00$ 167.65$ 324,352.00$ 173.08$ 2,970,592.00$ 450.43$ 150,738.00$ 110.19$ 2,247,684.00$ 235.93$ 6,062,354.00$

Dec-15 371,294.00$ 168.69$ 325,372.00$ 173.62$ 2,990,330.00$ 453.42$ 153,123.00$ 111.93$ 2,124,106.00$ 222.96$ 5,964,225.00$

Jan-16 341,678.00$ 155.24$ 294,791.00$ 157.31$ 2,917,672.00$ 442.41$ 148,569.00$ 108.60$ 2,004,120.00$ 210.36$ 5,706,830.00$

Feb-16 311,628.00$ 141.58$ 272,598.00$ 145.46$ 2,932,501.00$ 444.66$ 120,440.00$ 88.04$ 1,948,298.00$ 204.50$ 5,585,465.00$

Mar-16 363,412.00$ 165.11$ 337,163.00$ 179.92$ 3,366,414.00$ 510.45$ 144,623.00$ 105.72$ 2,292,817.00$ 240.67$ 6,504,429.00$

Apr-16 352,394.00$ 160.11$ 317,119.00$ 169.22$ 3,287,966.00$ 498.55$ 131,840.00$ 96.37$ 2,311,838.00$ 242.66$ 6,401,157.00$

May-16 398,428.00$ 181.02$ 351,088.00$ 187.35$ 3,399,130.00$ 515.41$ 160,517.00$ 117.34$ 2,605,558.00$ 273.49$ 6,914,721.00$

Jun-16 394,075.00$ 179.04$ 385,749.00$ 205.84$ 3,470,117.00$ 526.17$ 152,245.00$ 111.29$ 2,736,916.00$ 287.28$ 7,139,102.00$

FY TOTAL 4,359,575.00$ 1,980.72$ 4,032,622.31$ 2,151.88$ 38,442,092.00$ 5,828.98$ 1,763,152.00$ 1,288.85$ 28,865,615.00$ 3,029.87$ 77,463,056.31$

TERMINAL 3 TERMINAL 4 WEST ECONOMY EAST ECONOMY GROSS REVENUE

TERMINAL 2