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SATS has tied up with Singapore Post (SingPost) for the former to provide airmail consignment handling services to the postal carrier.
Both firms announced in a joint statement that they had signed a commercial agreement for the new automated facility, SATS eCommerce AirHub, to improve efficiency and space utilisation and to enhance their consignment handling capabilities.
The 6,000-square-metre facility - SingPost will be its anchor customer - is expected to be operational by December 2016 and will be located at SATS Airfreight Terminal 1 within the Changi Airfreight Centre.
SATS will become the first ground handler in the world to own such an airside facility.
Under the terms of the agreement, SingPost will outsource its airport consignment operations located at Changi Airmail Transit Centre 2 (ATC2) to SATS when its lease at ATC2 expires in end-2016.
As a result of the collaboration, both SATS's and SingPost's airmail consignment operations will be integrated under one roof.