Ottawa Airport Expansion Set to Take Off

Less than three years after the new terminal at the Ottawa International Airport opened, construction will start this summer on Phase II.

The project, which will cost an estimated $95 million, will be completed in 2008. It will be paid for with $15 airport-improvement fees collected from passengers taking off from the airport.

The expansion is the result of consistent increased passenger volumes and higher revenue over the past three years. Total passenger volumes of 3,735,433 set a new record for the airport last year, an increase of more than 100,000 from 2004.

The Ottawa Macdonald-Cartier International Airport Authority (OMCIAA) generated revenue of $72.5 million in 2005, compared to $69.6 million in 2004 and $63.3 million in 2003.

Expected passenger numbers for 2006 have not yet been released, but OMCIAA board chair Jim Durrell says: "All signs point to continued growth in 2006 and beyond."

The current terminal cost $310 million to build and includes 18 gates and a 60,000- sq.-m building, as well as a four-storey, 1,700-car parking garage and a de-icing facility. The airport has three runways, which were revamped during the construction of the current terminal.

Phase I came in under budget and ahead of schedule, and Durrell says the airport authority will not be asking for any federal money for the latest stage.

"I cannot emphasize enough that no taxpayer dollars will be used to fund this expansion," he says. "It will be paid for entirely by the $15 airport-improvement fee that is collected from all enplaned passengers."

Phase II planning has been in the works for some time. When complete it will add a 7,000- sq.-m terminal to the airport, as well as another 12 gates.

"Given the increase in passenger volumes and the addition of several flights and charter airlines since the opening of the new terminal in 2003, we are now at a point where congestion during peak times could become an impediment to further growth," Durrell says.

The focus on staying ahead of increasing passenger loads appears to be warranted since both Air Canada and WestJet have had strong passenger load performances in recent months.

Air Canada filled 83.2 per cent of its available seats in May, up from about 80 per cent in May 2005. WestJet also had impressive passenger loads in May, with 76.9 per cent of its seats filled - its best May on record.

Charter airlines such as Air Transat have also have been having a good year. As well, Transat AT, Air Transat's parent, recently acquired Thomas Cook Travel Ltd., making it the largest retail distributor of holiday travel products in Canada.

Since the current terminal opened in 2003, charter airlines, such as Ottawa-based Zoom Airlines, also have started using the Ottawa airport. The OMCIAA is not commenting on whether more airlines will be coming to the city once Phase II is finished.

The latest expansion will have some challenges not seen in the previous phase.

The biggest will be the demolition of the old terminal, which Durrell refers to as a "third-world facility."

The old terminal, which once gave those flying into Ottawa a grim view of what to expect from the city, is being demolished at the same time as the Phase II construction is occurring.

Once the old terminal is gone, it will mean more room for planes to manoeuvre. Currently, two large planes can't pass side by side at the airport. With the old terminal gone, that will no longer be an issue.

"It will enable a lot better circulation of runways and on the aprons," says Dale Craig, president of JL Richards, the Ottawa company building the Phase II structure. "Both the airport operators and the carriers will be happy."

Building an airport in phases does cause some challenges, however.

"It adds some complexity making sure you hook into existing services," Craig says.

Some of the leftover material from the old terminal will be incorporated in the new building, including using some of the douglas fir wood from one of the old hangars.

"We're trying to incorporate some different, warmer materials," Craig says.

By growing slowly and monitoring demand, the airport has been able to control its budget and keep customers happy in the process, despite the large projects they've taken on, says Pierre Lanoix, vice-president of operations and construction. "If you take small pieces, you can eat an elephant," he says.

"I think it really represents the completion of a dream," Craig says.

A third expansion for the airport is planned, but will only be undertaken as passenger volumes warrant.

It is estimated that the airport contributes more than $1 billion annually to the local economy.

"It's been proven that when the airport does well, the local economy does well, and there are linkages between the growth of passenger volumes and direct and indirect employment in the surrounding communities," Durrell says.

An example is Dell Inc., which recently opened a major call centre in the west end of the city, creating about 1000 jobs.

Lanoix says one of Dell's stipulations for coming to Ottawa, was that it had to have an easily accessible, first-class airport.

BusinessEdge