Like the steel support system now mostly installed for the $1.4 billion new terminal at the San Antonio International Airport (SAT), another funding pillar for the project has also been put into place.
On Tuesday, the 2026 Airport Revenue and Refunding Bonds, the city’s biggest-ever airport bond issue, were released to the municipal bond market to support the terminal development program and related capital projects.
The funding will support construction of a new 18-gate terminal expected to be complete in 2028. The terminal is the largest piece of the strategic development that projects annual passengers to increase from approximately 10 million in 2019 to 14.5 million by 2040.
The revenue bond is part of a financing package for the $2.5 billion in airport projects that includes $188 million in grants from the Federal Aviation Administration, infrastructure bill funding and airport revenue and fees.
The bonds were priced at $866.44 million, according to a recent memo from City Manager Erik Walsh to City Council members. The bond sale generated $3.9 billion in orders submitted by 78 institutional investors, including about 61 new investors.
The City plans to issue airport revenue bonds again in 2027, 2028 and 2029.
Revenue from airline lease agreements and fees will back the 2026 bond.
In May, after an almost two-year legal battle, airport officials and Southwest Airlines reached a settlement over the lease and use agreement and the new terminal project.
The deal gives Southwest guaranteed access to the new terminal despite initial plans to delegate the airline to the aging Terminal A, which is planned with Terminal B to get $260 million in improvements.
At the San Antonio airport, Southwest serves 23 destinations and is SAT’s largest carrier, based on scheduled seat capacity, according to documents supporting the bond ordinance.
“While it’s tremendously helpful to have all 10 signatory carriers committed to the long-term growth of the airport, we’ve always planned to sell the bonds this summer,” said Assistant City Manager Jeff Coyle.
Almost 900,000 passengers used the San Antonio airport in May, a decrease of 8% over the same month last year, according to an airport statistics report.
The drop is due in part to Spirit Airlines’ exit after the carrier filed for bankruptcy in late 2024.
SAT carriers American, Frontier and Sun Country experienced the largest increase in service since last year.
The latest on airport projects
Terminal C
Work on the new terminal project got underway in December 2024 near Terminal B and continues on pace with three cranes and about 450 workers on the site every day, said Tim O’Krongley, deputy aviation director for the City of San Antonio.
“Even with the last couple rounds of rain, luckily, we were … going vertical,” he said. “While rain you know can delay anything, we haven’t taken any real big delays.”
Seventy percent of the steel supports are in place for the terminal and nearly the same percentage of the wood beams are completed, he said. The first set of escalators have been installed and the elevators have been delivered, ready to be put in place in August.
A permanent power source is scheduled to be on site later in the year, and the dry-in — when the building’s exterior shell is sealed — should start in early 2027, O’Krongley said. That milestone will be followed by work on the interior of the terminal.
As for the exterior, just this week, crews began working on the terminal’s ramp, or apron, that the aircraft will use.
Construction on the terminal is about 25% done and a topping-off ceremony is expected in the fall.
Meanwhile, the planning for food, beverage and retail providers at the new terminal is in the works. The concessions contract bidding process opened in June with responses due by Sept. 23.
Ground transportation center
The demolition of three existing buildings at the airport was completed in April to make way for a ground transportation center now under construction.
The functions in those former buildings were moved to other spaces on the airport grounds, saving “a significant amount of money” for the terminal development program, O’Krongley said.
Some unique architectural elements from the former Badge & ID Building were saved and will be incorporated in a connector being built between the transportation center and the new terminal, including the exterior travertine and terrazzo.
The distinctive Y-shaped columns from the old building will be incorporated in benches planned for an outdoor pathway.
That ground transportation center, designed by San Antonio-based architecture firm MarmonMok, got underway in June, and will increase the airport’s number of on-site parking spaces by 2,500.
It is expected to be complete by mid-2027 and in operation by 2028, O’Krongley said.
Arrival and departure lanes
The first of a four-phase project to redesign the curb-front roadways for Terminal A began in March, with a second stage expected to start at Terminals A and B later this year.
Plans also call for improvements to roadways entering and exiting the airport, at Loop 410 and Highway 281.
Ground load and facility
While travelers anticipate a new terminal, SAT has opened three new gates with an entirely new ground load facility that’s already in use.
The $55 million terminal, opened March 27, comprises gates A1A, A1B and A1C, a restaurant and souvenir shop.
While any carrier can use the terminal, airlines already employing the facility for flights include American, which offers air service to Phoenix; Sun Country, for service to Cancun, and Volaris, to Mexico, which is expected to restart soon, according to a SAT spokeswoman.
