A lot can change in the space of just two years in the commercial aviation business and that has clearly been the case at San Juan’s Luis Muñoz Marín International Airport, the largest airport in the Caribbean and the main gateway to the US territory of Puerto Rico. The facility, unofficially known as Isla Verde International Airport, has shown the true value of airport privatisation as Aerostar Airport Holdings breathe new life into the airport.

ROUTES AMERICAS 2016 will take place in San Juan, Puerto Rico, hosted by Puerto Rico Tourism Company with the support of their partners Aerostar Airport Holdings LLC and Meet Puerto Rico between February 7-9, 2016. Read the official release.

Aerostar – a joint venture between Highstar Capital and Grupo Aeroportuario del Sureste (ASUR), which also operates Cancún Airport and eight other gateways in south-eastern Mexico – has recently remodelled the first of Luis Muñoz Marín International Airport’ two terminals and reopened it fully to traffic late last year.

Work on the second terminal is due for completion by the end of this year, ahead of Routes Americas taking place in Puerto Rico in February 2016, hosted by Puerto Rico Tourism Company with the support of their partners Aerostar Airport Holdings LLC and Meet Puerto Rico.

These projects are part of a promised infrastructure upgrade by Aerostar Airport Holdings, which in return for an initial down payment of $615 million and a pledge to invest $1.4 billion in upgrading the gateway received a 40-year operating concession from the Puerto Rican government in 2013.

Over the long-term, Puerto Rico has the potential to become a prime destination in the Caribbean But, right now nearly 80% of San Juan’s passengers are O&D Puerto Ricans, with visitors and tourists only constituting 20% of the equation. The growth of low-cost connectivity to the island will only support its growing appeal among leisure visitors.

In the past 12 months, JetBlue and Southwest Airlines has added new links from the US mainland, while in the international market Avianca has introduced a number of flights to Bogota, Columbia. The airport’s latest coup was securing a twice-weekly Madrid-San Juan service from Spanish carrier Air Europa.

In addition to the island’s rich history and its bounty of sun, sand and beaches, investors believe Luis Muñoz Marín International Airport’s proximity to Puerto Rico’s higher education facilities, medical services, cultural events and overall business economy give it an advantage over neighbouring islands in the Caribbean to further diversify.

The emergence of US low-cost carriers in Puerto Rico is clearly visible in our analysis, below, which highlights the largest operators from the island by departure capacity. JetBlue Airways is the largest carrier in the territory having overtaken American Airlines in 2012.

Its share of capacity from Puerto Rico has grown from just 4.7 per cent in 2005 to a market leading 39.5 per cent last year. Over the ten years from 2005 to 2104 its capacity has increased from 370,000 seats to over two million in 2013 and 2104 with an average annual growth of 54.4 per cent across the period.

But, it is not just JetBlue Airways that is growing. Since AirTran Airways made its debut in the market in 2008 it has grown capacity and now through the Southwest Airlines brand following its merger is the fourth largest operator from Puerto Rico: the two low-cost carriers sandwiching the offering of American Airlines and Delta Air Lines.

The chart also clearly illustrates the reduction in American Airlines' capacity from the Caribbean island, which began in principle from 2008 as the carrier cut its mainline and regional American Eagle departures of Executive Airlines by almost half from just over 90 daily departures to just over 50. This was further reduced from 2013 as American Eagle closed its base at San Juan after over 40 years of operation as part of a network overhaul and the retirement of the ATR 72 from the carrier's fleet while American Airlines was under the Chapter 11 bankruptcy protection.