Once described as a "mudhole" in the aftermath of the Second World War, today's Victoria International Airport is a growing and diverse economic engine in the capital region.
Like many airports these days, YYJ is about more than just runways and airplanes.
The 465 hectares, under control of the Victoria Airport Authority, incorporates a range of enterprises that includes technology companies, yacht builders, house movers, manufacturers, office space, pilot training, aircraft mechanics, non-profit organizations and government agencies - even grazing for dairy cattle and hay production.
Billed as Canada's ninth busiest airport, its tenant mix reflects the global trend of airports establishing themselves as economic hubs with various services and uses.
"We are a gateway and an economic engine, that's clear," said Geoff Dickson, who became VAA president and CEO this year.
The importance of business is reflected in the authority's annual earnings. Last year, the authority registered $22.6 million in revenue on concession contracts - which include retail and food services, taxi and parking fees and money from advertising - bringing in the lion's share at $6.9 million and rentals of land at $2.5 million.
Landing fees delivered $2.8 million, general terminal charges brought in $2.35 million and airport improvement fees $7.4 million.
VAA land is being developed in stages, in consultation with the municipalities of North Saanich and Sidney, where its property is located.
Next month, the airport authority goes to North Saanich to discuss its next phase of potential development on 16 hectares on the southwest portion of the property.
Diversity at airports makes financial sense to Tae Oum, president of the Air Transport Research Society at the University of B.C.'s Sauder School of Business. The society issued a report this week examining airport efficiency. Victoria was not included in its evaluation although the larger Vancouver airport was, taking first place among Canadian airports evaluated.
"Our report shows that the world's most efficient airports are supplementing core income with money generated through non-aeronautical revenue streams, such as parking, office rentals, retail activity and real estate development," Oum said.
"Our benchmarking report also shows that more efficient airports tend to offer lower aircraft landing fees and passenger terminal charges, ultimately leaving more money in the pockets of travellers."
Victoria airport's landing fees are among the lowest in Canada and that's by design, said Dickson, because revenue from tenants keeps fees down and makes the airport an attractive destination for airlines.
John Kasarda, a professor at the University of North Carolina and co-author of the new book Aerotropolis: The Way We'll Live Next, said a new "urban form" of airports is appearing around the world, sometimes stretching up to 30 kilometres from the runways, acting as a powerful engine for economic development in planned smart, sustainable growth.
"The aerotropolis consists of an airport city and outlying corridors and clusters of aviation-linked businesses and associated residential development," he wrote on www.aerotropolis.com.
Victoria's airport is obviously not of this scope, but it was set up as an independent authority in 1997 to be financially self-sufficient. And business has been booming.
During the Second World War, the airport on the Saanich Peninsula was filled with planes and personnel, activity which dropped off when hostilities ended. An April 1956 issue of the Daily Colonist showed a Patricia Bay Airport (the airport's former name) sign listing: Trans-Canada Airlines, Pacific Western Airlines Ltd., Fairey Aviation Co. of Canada, the Victoria Flying Club, Pacific Aviation Services Ltd. and Vancouver Island Helicopters.
The airport now has close to 100 businesses and operations, including government tenants, on its land.
The airport generated gross revenues of $440.8 million (reflecting direct, indirect and induced revenue) in 2003, according to an economic impact study published in 2005. A subsequent evaluation has not been done, but the current figure is estimated at about $600 million, said Terry Stewart, VAA director of marketing and communications.
About 2,000 people are employed at operations on airport land, Stewart said.
Some rents are as low as $1 per year for tenants such as the B.C. Aviation Museum, while most are at what Stewart calls "reasonable" rates. Tenants are attracted by the large chunks of land which can be leased, along with other factors such as the proximity to the airport and ferries.
VAA works on a five-year timeline to develop various chunks of land, in partnership with the community, figuring out what is the highest and best use, he said.
"It is important to us to bring on the right kind of development, ones that are going to generate economic activity to the community ... We have contrived to be real stewards of the property."
He noted environmental audits are done annually on tenants, who work collaboratively with the VAA.
Initiatives include high-efficiency lighting in the terminal building, a rainwater management and monitoring program and environmentally friendly building construction.
VAA has just developed 10.9 hectares of land on Mills Road on the north side of the airport, where Thrifty Foods' 152,000 square-foot distribution centre is under construction. The $31-million project will create 50 new jobs once it is finished.
Some of the more established operations include the Victoria Flying Club, started in the 1940s, and Vancouver Island Helicopters, which was launched in 1955 with one Bell helicopter and is now one of the largest private fleet operators in the world.
Air courier Purolator is one of the biggest and busiest tenants, taking delivery via a Boeing 727 of between 10,000 to 20,000 pounds of material daily between Tuesdays and Fridays, and with air freight trucked in on Saturdays, said Armindo Pedro, operations manager.
Nicholson Manufacturing Ltd., known for its debarking technology and other forestry equipment, moved to airport land 20 years ago.
Viking Air, owned by Westerkirk Capital Inc. of Toronto, is the most high-profile success story at the airport. It has brought the rugged and versatile de Havilland Twin Otter back into production. Buyers from around the globe have put in orders worth hundreds of millions of dollars for new models of the renowned Canadian aircraft.
The next mega-project is the $104-million base for the Canadian Forces 443 Maritime Helicopter Squadron. It went to tender in May and the opening date for bids has been extended to Aug. 18. This 20,000square-foot operations and maintenance centre will house nine new Cyclone helicopters and is expected to create more than 800 construction jobs.
About 1.5 million passengers pass through the airport every year and its runways accommodate about 120 flights a day throughout North America - including new seasonal service to Phoenix, Hawaii and Las Vegas starting in the fall.
Total numbers of revenue-paying passengers dropped by 1.1 per cent in the first quarter and by 3.5 per cent in the second quarter of this year. Dickson suggested that the lower numbers could be due to concern over the economy in Canada and the U.S.
Source: http://www.timescolonist.com
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