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The One Place in Airports People Actually Want to Be

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On a bright, chilly Thursday in February, most of the people inside the Chase Sapphire Lounge at LaGuardia Airport appeared to be doing something largely absent from modern air travel: They were having fun. I arrived at Terminal B before 9:30 a.m., but the lounge had already been in full swing for hours. Most of the velvet-upholstered stools surrounding the circular, marble-topped bar were filled. Travelers who looked like they were heading to couples’ getaways or girls’ weekends clustered in twos or threes, waiting for their mimosas or Bloody Marys or the bar’s signature cocktail—a gin concoction turned a vibrant shade of violet by macerated blueberries, served in a champagne coupe.

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Other loungers in the golden-lit, plant-lined, 21,800-square-foot space chatted over their breakfast, boozy or otherwise. At the elaborate main drink station that formed one wall of the lounge’s dining room, I chose the tap that promised cold brew, though spa water and a mysterious third spigot labeled only as “seasonal” beckoned. When I reached for what I thought was a straw, I pulled back a glistening tube of individually portioned honey, ready to be snapped into a hot cup of tea.

While I ate my breakfast—a brussels-sprout-and-potato hash with bacon and a poached egg ordered using a QR code, which also offered me the opportunity to book a gratis half-hour mini-facial in the lounge’s wellness area—I listened to the 30-somethings at the next table marveling about how nice this whole thing was. That’s not a sentiment you’d necessarily expect to hear about the contrived luxury of an airport lounge. In the context of air travel, nice has usually meant nice relative to the experience outside the lounge’s confines, where most of your choices for a meal are marked-up fast food eaten at a crowded gate, or the undignified menu truncation of a Chili’s Too.

With the new mega-lounges, airlines and credit cards talk a big game about their culinary acumen, cocktail programs, and spa amenities.

American Airlines opened the world’s first airport lounge, then an invite-only affair for VIPs, in 1939. By the end of the 20th century, lounges had cemented their reputation as the domain of road warriors—mostly solo travelers headed to, say, medical-device sales conventions or engineering-job-site visits. The experience was less brussels-sprout hash and champagne and more “cheese and crackers and $5 beers,” Brian Kelly, the titular guy behind the Points Guy website (and arguably the most influential person in the travel-status game), told me. But behind those generously staffed check-in desks, things have been changing. Private-lounge networks have rapidly expanded over the past decade, as scores of new travelers have begun demanding entry. What awaits inside is changing, too.

Perhaps the most salient characteristic of the modern airport lounge is that it is busy. According to one estimate, the number of fliers visiting lounges hit an all-time high in the summer of 2023, and this year’s vacation season appears likely to top it. As Americans have rushed back into travel after a pandemic lull, they’ve also rushed to apply for new credit cards, the fanciest of which promise bounties of travel-related perks, including lounge access. Now a broader cohort of fliers is squeezing in alongside the usual business travelers. This new group might be described as work-from-home travelers: people tapping away on laptops, trying to wedge in a few more emails or Zoom meetings around pleasure travel.

In the past year, for reasons both journalistic and personal, I’ve visited seven lounges across five cities. These rooms held the expected corporate types in company-issued quarter-zips, but also 20-something women in Taylor Swift tour merch, bros with tennis rackets protruding from their carry-on, and lots of young people with one AirPod in and their Zoom camera turned off.

The lounge’s booming popularity complicates its premise. This expanding group of high-spending customers is valuable to airlines, which operate most lounges, and to credit-card issuers, who have joined the lounge market with their own club networks. (High-fee credit cards, Kelly told me, have become the most common way for airline-perk neophytes to access lounges, no matter whether they’re run by airlines or banks.) But to attract these customers, lounge operators need to uphold the impression that lounges are exclusive—a special place far from the airport cattle call, not one crammed with too many other valued customers. The operators’ solution to this dilemma has been to build fast and build big, putting up huge, extravagant new clubs as quickly as the vagaries of airport construction will allow. Globally, more than 3,000 airport lounges are now open, with most major operators promising to add at least a few new locations this year.

Most of the existing lounges max out somewhere around the ambience of a Panera, with booze instead of lemonade. The food and drinks are free, and that’s usually their main selling point. With the new mega-lounges, though, airlines and credit cards alike talk a big game about their culinary acumen, cocktail programs, and spa amenities, which include massages, private showers, and manicures. In United Airlines’ new 35,000-square-foot, three-story lounge in Denver, one of its two bars evokes a brewery, complete with tasting flights from Colorado brewers. Delta is opening the first in a series of ultra-premium clubs in June: a 38,000-square-foot mega-lounge at New York’s JFK airport containing, among other things, a full-service French bistro. American Express’s largest-ever lounge, which opened recently in Atlanta, has a backroom whiskey bar, a menu designed by a celebrated local chef, and 4,000 square feet of outdoor space from which loungers can watch planes roll by.

You could dismiss the amenities arms race as an absurd exercise in flattering wealth’s vanity—it is. But that flattery is so effective because lounges offer a solution to a real set of problems. In the past few decades, air travel in the United States has become notably worse. Airlines have shrunk seats, increased fees, and pushed a larger proportion of passengers toward expensive tickets that offer more room and better service. At the same time, tickets at the back of the plane have become much less expensive, which has increased overall demand. Americans took 665 million flights in 2000, and by 2019, that number had increased to more than 925 million. On top of this, American airports are pretty old, and many need serious upgrades to handle the passenger volume more comfortably.

Airlines profit from these conditions, but they still have to keep their most profitable customers happy. Lounges go a long way toward placating frequent fliers. They are, on some level, a decent deal for all involved: Private companies shoulder the cost of building them. They cater to people who endure the indignities of air travel most often. For many of those people, the pricey fees probably do save money over time, relative to how often they’d otherwise buy astronomically marked-up food from airport vendors. And the clubs tend to get put in inconvenient spots, which should theoretically help ease overcrowding at the gate, or at least move some of the fussiest passengers to their own containment area.

More curious is the fact that credit-card companies are making the effort to launch entire lounges themselves, competing against airlines when they already partner with airlines to get cardholders into existing lounges. A lounge is, by all accounts, a huge money sink—even besides the cost and red tape of building within an airport, making people feel special requires an army of workers available 18 to 20 hours a day, seven days a week. Everyone I spoke with at companies that run lounge networks said some version of We do not view the lounges as revenue opportunities.

Illustration by Max Guther

Lounges are, however, a great incentive to sign up for credit cards. As people’s day-to-day financial lives become more cashless, credit-card issuers are battling one another to win over customers and encourage them to swipe as much as possible, Joseph Nunes, a marketing professor at the University of Southern California, told me. One big reason: interchange fees. Card issuers take a cut of the purchase price from sellers every time a card is used, and that cut tends to be larger for more premium cards. Frequent pleasure travelers are a creditor’s dream: They are wealthier than the average American, they do a lot of discretionary spending, and they pay their bills on time. Lounges have already succeeded at enticing this group to sign up for airline-specific credit cards, so card issuers have taken the next logical step: lounges for people who aren’t quite road warriors and who may not be devoted to any particular airline, but who want perks all the same.

Controlling an entire lounge, stamped with an enormous company logo, is a play for what marketers call brand affinity. “It solidifies our relationship with our customers,” Audrey Hendley, the president of American Express Travel, told me. Those customers might visit a lounge only a few times a year. But if everything goes according to plan, those visits are one of the reasons they love their Amex Platinum or Chase Sapphire card and use it for everything, even though they’ve got three or four others they could pull out of their wallet.

Of course, the genuinely wealthy still need to be convinced that they’re more special than the rest of us. Credit-card companies have been ready to oblige with even more layers of exclusivity. Chase’s LaGuardia lounge is open to anyone who pays a $550 annual fee for the right credit card, but the private suites inside, which include a palatial bathroom and all the seafood towers you can eat, cost up to $3,000 for a three-hour visit. This is part of what Nunes called the further tiering of society, fueled by the incredibly granular financial-data profiles that companies can now make of their customers. “We really say, ‘Where are consumers spending, who are the consumers that are the most profitable for me, and how should I treat them?’” Nunes told me. “We’re going to see further and further discrimination by firms, I think, in treating their most profitable customers the best.”

Credit-card perks have proved such an effective way to lure high-income customers that the airport lounge has begun to make its way outside the airport. Card issuers now commonly sponsor VIP areas at concerts and sporting events, especially those that appeal to high spenders. American Express and Chase offer members-only lounges at the U.S. Open tennis tournament in New York. The Sundance Film Festival has had a Chase Sapphire lounge for years. And although it can seem silly to get excited about entry to a VIP area, few people are immune to the charms of more places to sit down, shorter lines for cleaner bathrooms, and a couple of free drinks.

Even if you never have entered or never will enter an airport lounge, the perks arms race affects your daily life. More premium-card use means higher fees for retailers, and those fees then get baked into the prices everyone pays—an easier task for large sellers, who usually pay less for their goods than mom-and-pop stores. (A recent settlement in a class-action suit against Visa and Mastercard could lower and cap these fees while allowing retailers to charge customers with premium cards extra.) Meanwhile, many card issuers have also begun to experiment with opening places that target other tiers of customers too. Capital One now operates more than 50 cafés that are open to the public, which seem aimed at the kind of young, laptop-lugging workers who might someday be high earners but for now just need a coffee shop with free Wi-Fi. In addition to baristas, these spaces have “ambassadors” and “mentors” available to guide patrons through the bank’s range of services while they sip their lattes. These cafés, like the airport lounges, are money sinks. But Kelly told me that it’s a mistake to think about banks the way we think about other consumer-facing businesses. “Look at the earnings reports of any of the credit-card companies,” he said. “This is a drop in the bucket.”

In February, I visited American Express’s Centurion New York club in Midtown Manhattan. The space, which uses the entire 55th floor (and one dedicated express elevator) of the new One Vanderbilt skyscraper on 42nd Street, is the first of its kind for the company. It is, in some sense, a Capital One café for people already very comfortable with the services offered by their preferred financial institutions. A few tables in some of its spaces can be reserved by the general public, but no one there will sell you a new credit card or recommend a loan for your small business. The club’s best nooks and crannies, including a large corner table with clear views of much of the city’s skyline, are reserved for those who carry the company’s invite-only Centurion Card, which is rumored to require at least $500,000 in annual charges for membership. One Centurion-exclusive bar gives you a view from heaven down onto the Art Deco curves of the Chrysler Building below, as though you are a god yourself.

This article appears in the June 2024 print edition with the headline “The Airport-Lounge Arms Race.”

Kaynak

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