Note: The Sidney Gateway shopping centre has been renamed Sidney Crossing

Victoria International Airport is a major player in the region's real-estate industry despite its primary role as a transportation hub, a fact that may be a surprise to most Victorians.

Some 66% of the airport's (YYJ) revenues are non-aeronautical, meaning they are generated through business activities not directly connected to the airline travel industry or general aviation. And the Victoria Airport Authority (VAA), tasked with managing the airport and its facilities, hopes to grow that number even further.

"The goal is to responsibly lease and develop surplus land to generate additional revenues and avoid passing on operational costs to passengers and businesses at the airport. At-present we have twelve properties earmarked for development," said James Bogusz, Vice-President of Operations and Development at the Victoria Airport Authority.

YYJ has some of the lowest operational costs for airlines and some of the lowest passenger fees in the industry, an enviable situation in an age of rising expenses. That's largely a result of non-aviation revenue that makes possible incremental capital improvements for passenger facilities and airline operations with little to no financial burden on passengers. It has also helped keep the VAA from following in the footsteps of other Canadian airports incurring major debt to improve facilities.

A common misconception, says Bogusz, is that YYJ's operations are subsidized by the federal government.

"The federal government is our landlord. Since 1997 we have been paying the government a percentage of our revenues, and on top of that we are responsible for funding our own capital investments and improvements," Bogusz said.

"We spent $8 million in 2013 and 2014 on the concessions circulation project for departing passengers, and this year we will be starting an apron (parking) expansion for commercial aircraft, another $8 million project. In 2016 work will begin on an expanded departures area that will extend the passenger terminal north up to the new apron," Bogusz said, noting that over the next 10 years the VAA has budgeted some $160 million for capital improvements.

One of VAA's most ambitious non-aviation related development endeavours is the Sidney Gateway commercial project at the west end of the airport at Stirling Way and Beacon Avenue.

The 100,000 square foot, $30 million shopping centre will be developed in partnership with Omicron, a Vancouver-based real-estate development firm.

"Sidney's official community plan envisions a commercial use for that parcel of land, so really what we're doing is proposing a project that is in-keeping with the town's own plans supported by residents of the area," said Bogusz.

The VAA will be officially presenting its intentions to Sidney council on August 10th to seek support from elected officials for the concept and removal of the land from the agricultural land reserve. If received favourably, the next step will be a review by the Agricultural Land Commission in September. Pending successful reception there the VAA will apply for a rezoning, hold additional public consultation sessions, and eventually that may lead to project approvals some time in 2016. [August 11, 2015 update: Sidney council voted to unanimously support the removal of the Sidney Gateway parcel from the agricultural land reserve.]

Approximate site plan of the Sidney Gateway shopping centre.  Victoria Airport Authority/Omicron.

The municipal process, however, is a formality. With the airport situated on federal land municipal restrictions do not apply, neither does an agricultural land reserve designation. The VAA has the freedom to develop the land as it sees fit. Although that's not very neighbourly, concedes Bogusz, and insists that it is in everyone's interest to develop airport lands in accordance with local planning guidelines and development expectations.

The Ministry of Transportation will be consulted regarding road realignments and highway improvements, if required, says Bogusz.

"We may be asked to extend the left-hand turning lane on the Pat Bay Highway northbound and we may also have to make other improvements to roads. The Ministry will review and let us know what they need."

A future Sidney highway interchange at Beacon Avenue and the Pat Bay Highway will be accommodated, Bogusz confirmed, adding that whatever the VAA and Omicron develop will be in accordance with future highway improvement plans.

Moving counter-clockwise from the Sidney Gateway property, a parcel of land at Henry Avenue West and McDonald Park Road will be developed into a new chemical manufacturing facility and offices for Seastar Chemicals, currently occupying space just north of YYJ's perimeter. Approvals are in place and construction will be starting later this year.

Along YYJ's northern perimeter Sobey's has an option to develop a large parcel adjacent to its newly built Thrifty Foods warehouse off Mills Road. If Sobey's doesn't renew its option on the land it will be made available for lease by 2018.

Further west VAA hopes to secure one or two companies interested in building aviation hangars or a hangar-style development on vacant airside land. The area is ideally suited for light aviation uses and has taxiways capable of handling one or two engine light aircraft.

Along the western edge of the airport the VAA is currently working to secure a long-term lease from the province for the seaplane base located at the foot of runway 09. Airport tenants, including Viking Air and Ramsay Machine Works (recently acquired by the Ralmax Group of Companies), rely on the seaplane base for key business operations. Ramsay Machine Works in particular, says Bogusz, will utilize YYJ's taxiways to transport over-sized machinery from their facility on the west side of the airport onto barges waiting at the seaplane base. Without that access Ramsay would be forced to move its products along municipal streets, presenting significant risks and costs.

The old 443 Squadron hangar at Victoria International Airport is on the left, with the newly built 443 facility on the right.  Citified.ca.

Rounding the airport perimeter, the federal government recently completed construction on 443 Squadron's helicopter facility. The building it replaced will be vacated by early 2016, freeing up a considerable portion of land for development and presenting the opportunity to build a new taxiway to connect future airside businesses and services.

South of 443 Squadron across Willingdon Road are ten subdivided parcels for a business park the VAA has dubbed The Landing. Some 30 acres are available for development, with uses highly suited to aerospace, high-tech and light manufacturing. The VAA is actively seeking parties interested in developing individual or multiple parcels at The Landing.

Back at the passenger terminal, design work has begun for what will become an extended long-term parking lot south of the existing long-term lot. A temporary gravel parking lot will also be created to the west of the passenger terminal building to add capacity during peak travel periods. The work will coincide with the apron and terminal expansions described earlier.

And finally between runways 14 and 27 on the southwest portion of the airport, Viking Air and Pacific Sky Aviation are about to begin construction on a state-of-the-art Twin Otter simulator facility that will offer the world's most advanced simulator for that particular aircraft. Crews from around the globe will travel to Victoria to practice ground and water landings and aircraft operations in a Twin Otter simulator so advanced that actual flight hours will be recorded while pilots are behind the controls of the simulated aircraft.

"It's not just about airplanes," Bogusz says jokingly. "Our goal is to keep costs low. We're proud to offer our passengers low fees and modern facilities, and land development is a big part of making that possible." C

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Victoria poised for record breaking volume of office construction