Hotel tycoon reveals Heathrow runway expansion proposal

Hotel tycoon Surinder Arora has announced he is submitting a Heathrow expansion plan which rivals a proposal from the airport’s owners.

The billionaire’s Arora Group said the “primary benefit” of the plan it submitted to the government was a shorter new runway which would avoid the costly and disruptive need to divert the M25 motorway.

Building a 2,800-metre third runway instead of the full-length 3,500-metre runway planned by the airport would result in “reduced risk” and avoid “spiralling cost”, the company said.

The airport declined to comment on the Arora Group’s proposal.

A shorter runway could have limits on its use, although Arora Group insisted it would be able to accommodate aircraft of all sizes.

The announcement means that for the first time, there will be two bids on the table to build a third runway at Heathrow.

Arora Group said its plan, called Heathrow West, could have a new runway fully operational by 2035, while a new terminal would open in two phases, in 2036 and 2040.

The plan, developed with infrastructure company Bechtel, has a cost estimate of under £25 billion, not including the redevelopment of the airport’s existing central area.

Heathrow said in 2018 it could complete its runway for £14 billion, but it is now expected to cost billions more.

In June, the government invited competing proposals for Heathrow’s expansion and set a deadline of 31 July.

Mr Arora, who is one of the largest landowners at Heathrow, said: “After a decade working with our world-leading design and delivery team, I am very proud that the Arora Group can finally unveil to the UK government our Heathrow West proposal.

“The Arora Group has a proven track record of delivering on-time and on-budget projects including in and around Heathrow airport.

“We are delighted that the government has taken a common-sense approach to invite proposals from all interested parties for the very first time rather than granting exclusivity to the current airport operator, no matter its track record.”

Mr Arora has repeatedly accused the airport of wasting money.

Carlton Brown, CEO of Heathrow West, said the new company would be able to dedicate time and focus to the expansion while working with stakeholders including airlines, communities and business.

“Ultimately, I want to see Heathrow help Britain become the best-connected nation in the world and facilitate the trade and inward investment our UK economy needs,” he said.

In December 2024, French company Ardian completed a deal to become Heathrow’s largest shareholder with a 23% stake, while Saudi Arabia’s sovereign wealth fund purchased a 15% share.

Chancellor Rachel Reeves gave her backing for a third runway in a speech on growth in January.

Heathrow will submit its own expansion plan to the government on Thursday.

It had planned to create a third runway by rerouting the M25 motorway between junctions 14 and 15 through a tunnel under the new runway.

After receiving the proposals, Transport Secretary Heidi Alexander will review the Airports National Policy Statement, which provides the basis for decision-making on any Development Consent Order application.

Heathrow is understood to be open to a discussion with airlines about building a shorter runway if it can deliver the same benefits.

If expanded, the number of flights at Heathrow Airport could go up to 720,000 – or nearly 2,000 a day on average. They are currently capped at 480,000 a year.

Heathrow told the BBC that it would eventually be able to serve up to 140 million passengers a year once a third runway is in operation.

Paul McGuinness, chair of the No 3rd Runway Coalition, said they were concerned that thousands of people would have to be rehomed for the plans to move forward.

He added: “There’s a real danger that we’ll end up with a hole in the ground and a debt pile for taxpayers to underwrite, because the government had foolishly encouraged Heathrow’s profligate self-interest, as if blind to the lessons of HS2.”

In the past, the cost, the Covid pandemic and legal challenges have all got in the way of any development.

A third runway was first proposed in 2009 by Gordon Brown’s Labour government but was only finally given the go-ahead by the Supreme Court in 2020.

The last bid sunk was partly by a legal challenge from five local councils and the Mayor of London.

Several members of the current government – including Prime Minister Sir Keir Starmer – voted against a Heathrow expansion when in opposition.

But Sir Keir told the BBC that the government has climate commitments, “but growth is really important too”.

Asked in January this year, when the government announced that it was in favour of a third runway, London’s mayor Sir Sadiq Khan refused to rule out joining any future legal challenge to expansion.