Delta Air Lineshas broken ground on the USD 4 billion redevelopment of its terminals atNew York LaGuardiaairport, its largest airport investment ever.

The works will see the Atlanta-based carrier rebuild its facilities in terminals C and D at the airport into a new, "world class" facility with 37 gates that can accommodate all of its operations at the popular New York airport.

"We believe this investment will further cementDelta's position as the number one airline in New York," says Ed Bastian, chief executive ofDelta, at a ceremony atLaGuardiatoday.

The project isDelta's largest investment at an airport ever, he says, exceeding the at least USD 1.4 billion the airline invested in expanding terminal 4 atNew York John F KennedyInternational airport through 2015.

The works are also the single largest investment by any single airline at any of the three New York airports. Previously,American Airlinesinvested USD 1.3 billion in redeveloping terminal 8 atJFKin 2007 andJetBlue Airwaysinvested USD 750 million terminal 5 atJFKin 2008.

Delta'sLaGuardiaterminal is part of New York governor Andrew Cuomo's overhaul of bothLaGuardiaandNew York John F KennedyInternational airports, that includes a new USD 4 billion central terminal at the former and an overhaul of the terminal area atJFK.

Smart Tariffs: Book in advance - Save 30%! - ONLINE

The mainline carrier will begin enabling work next to terminal D within a month, its vice-president for New York Henry Kuykendall tells FlightGlobal on the sidelines of the event. The first phase of the project will open in 2021 with the full build out complete by 2026.

Ukraine Aviation Portal

The airline is taking a multi-pronged approach to ensure it does not lose market share during the nearly nine years of construction. This includes closely monitoring passenger satisfaction through customer surveys and staying ahead of potential passenger disruptions, like traffic to the airport, says Kuykendall.

One measureDeltais watching closely are passenger numbers.A big concern for Kuykendall was that numbers would fallthis summer compared to last year due to the construction of the new central terminal building, he says.

However, the airline's passenger numbers are up 1.5 percentage points atLaGuardiathis year, despite well publicised congestion issues to the airport due to the central terminal works, says Kuykendall.

"We have to make sure, as a community, that we don't sit back and say 'the airport's bad, there's construction,'" he says. "We've got to say 'excuse our dust'… nothing's been done [for years] and, during the pain process, you've got to say here's the after."

Deltadoes not plan to shift any capacity to eitherNew York JFKorNewarkairports during construction, says Kuykendall.

The terminal project is budgeted at USD 4 billion, which is split between USD 3.4 billion fromDeltaand USD 600 million fromLaGuardiaoperator the Port Authority of New York and New Jersey (PANYNJ), he says.

Prior toDelta's decision in July to move forward on the project without equity partner Goldman Sachs-owned West Street Infrastructure Partners III, the terminal was forecast to cost USD 4.5 billion, including a USD 3.6 billion bond issue, USD 600 million from thePANYNJand USD 300 million in equity.

Delta is still evaluating how it will finance the terminal redevelopment, says Kuykendall.

The investment follows a concerted effort by Delta to establish itself as the largest carrier in New York. This dates back as far as 1983 with the opening of the USD 90 million Delta Flight Center, also known as terminal D. The airline closed a slot swap withUS Airwaysin late 2011, giving it the largest share of slots atLaGuardia, and invested USD 160 million into upgrades to its newly acquired space in terminal C a year later.

Delta carried 38.5% of the 29.8 million revenue passengers atLaGuardiain 2016,PANYNJdata shows.American Airlineshad the next largest share at 19.3%.