A subsidiary of construction giant Leighton Holdings has bagged a $370 million contract to build a new terminal and integrated transport facility as part of a $10 billion upgrade to Melbourne Airport.

In a statement on Tuesday, Leighton Contractors announced it had secured an agreement with airport owner Australian Pacific Airports Pty Ltd to build both the new Terminal 4 and the transport facility.

Work on the terminal will be delivered through a joint venture with its own subsidiary Broad Construction and will include baggage handling and re-claim facilities, check-in kiosks and associated infrastructure, staff amenities, retail areas and connections to existing concourses.

Set to be built at the southern end of the airport on approximately 20,000 square metres of land between the existing Terminal 3 and Terminal 4 buildings, the new terminal will be able to handle 10,000 passengers each year upon its anticipated completion in 2015.

Work on the transport facility, meanwhile, includes the construction of a seven-storey car park, elevated access roads and ramps, an underground service tunnel, electrical substation and ancillary infrastructure.

The works are part of the first stage of the airport’s Southern Precinct Project, future stages of which will see the new terminal expanded to 35,000 square metres and able to cater for 20 million passengers.

That in turn, is part of the airport’s broader 20-year master plan, the draft of which was unveiled in May this year and which foreshadows infrastructure such as a third runway and an elevated loop road as part of a strategy to boost the airport’s capacity to cater for an anticipated 35 million new passengers between now and 2033.

For Leighton Contractors, the win builds on subsidiary Broad Construction’s work on the upgrade of the Perth Airport, which included a new terminal, earlier this year.

Another Leighton subsidiary (John Holland) did previous work at Melbourne Airport through its role as the managing contractor behind the airport’s Terminal 2 Expansions (T2E) project, which was completed in 2011.

Leighton Holdings chief executive officer Hamish Tyrwhitt welcomed the contract win.

“This award demonstrates the Leighton Group’s strength in the civil infrastructure and commercial building markets, and the ability of our companies to collaborate, leveraging their scale and range of core competencies to deliver innovative solutions and value for clients,” he said in a statement.

Works on the latest contract are scheduled to commence later this month.