Location: Edmonton Int'l Airport
Overall Cost: $30 million
Development Area: 200 acres
Number of Multi-Tenant Structures Constructed: 3
Building Sizes: 50,000, 63,000 & 93,000 sq. ft.
Private Development Partners: Hangar Development; TerraCap Group
Tenants: Alberta Health Services; Canada Border Services Agency; Cargojet; Federal Express Canada Ltd.; Fox Flight; Purolator; STARS
New Cargo Apron: 236,000 sq. ft.
Cargo Apron Cost: $10 million
Cargo Apron Contractor: Dufferin Construction Co.
Geographic Advantages: On Great Circle Route between Asia & North America; close to highway, railway
Upcoming Event: National Cargo Conference:
Riding a province-wide economic boom, Alberta's Edmonton International Airport (YEG) is leveraging $30 million of cargo area improvements to attract larger aircraft and expedite freight transfers for a variety of shippers.
YEG's new air cargo area, unveiled late last year, includes three multi-tenant airside buildings and a 236,000-square-foot dedicated concrete cargo apron. A "cargo village" to house shippers, freight forwarders, brokers and other transportation-related businesses is planned next.
"There's a tremendous economic message in Alberta that's driving all the growth," reports Norm Richard, YEG's director of Air Service Development. "Edmonton International wants to help stimulate that growth and drive business to and from the region."
The cargo upgrades, located on approximately 200 acres of land on the airport's south side, were spurred by three years of positive growth in the airport's cargo business and have been well-received by the private sector, report YEG officials.
Cargojet, which provides time-sensitive overnight air cargo services, jumped on board quickly, leasing space in one of the buildings. Purolator, an integrated freight and parcel solutions provider, soon followed.
Federal Express Canada Ltd. upgraded its international freight service between YEG and the FedEx world hub at Memphis International by adding weekday service with a wide-body Airbus 310. In addition to boosting the company's daily air cargo capacity by more than 1,600 cubic feet, the change improves the airport's aircraft mix.
"We didn't have wide-bodied freighters previously," Richard explains. "It was a service gap that we were missing. Our upgrades are a real testament to the carriers that are now coming in to utilize Edmonton International."
The airport is already experiencing a "halo effect" from its investments, he adds. "We view ourselves as a catalyst of economic development within our community ... The more access we offer our freight customers, the more business comes to and departs from Alberta. With each and every added shipment, there's a positive return for us."
As Canada's fastest growing airport, YEG previously struggled with capacity issues. Conditions prompted officials to launch an ambitious airport improvement program several years ago. Upgrades began on the passenger side, outfitting the facility to accommodate up to 10 million annual passengers. Then, the focus shifted to the cargo side.
YEG created taxiways and roads, installed a dedicated cargo ramp and added 236,000 square feet of apron space for cargo aircraft. The $10 million apron, developed by Dufferin Construction Co., was completed in about six months with the help of an onsite concrete plant.
Two multi-tenant buildings - a 50,000-square-foot facility and a 93,000-square-foot facility - were constructed in partnership with external investors. Airport officials expect both to be fully leased by summer.
The 50,000 square foot building, owned by Terracap Group, houses Cargojet and Purolator. With a dedicated cargo ramp and 20 bays, it was built with airfreight in mind, Richard relates. "The warehouse portion leads directly to the aircraft, and the nose of the aircraft is within 20 to 30 yards of the building," he says. "In terms of efficient operating, it couldn't be better."
Cargojet leases 8,700 square feet of office and warehouse space for its fleet of Boeing 767-200ERs, 757-200ERs and 727-200AFs. The company transports courier products, perishables, live animals and large main deck cargo such as oil field equipment for Alberta's burgeoning petroleum industry.
Cargojet personnel appreciate the new cargo ramp, which makes loading and unloading more efficient and helps protect freight from Edmonton's extreme weather conditions. "(Previously) we had to park on a ramp adjacent to our facility, which added extra time to transport the cargo to and from the aircraft," recalls Lyle Gibson, Cargojet's general manager for Western Canada. "Now we just open our airside door and the aircraft is right there."
The new facility also allowed the carrier to expand its bonded area - an important upgrade, since the company recently took on additional international business that the Canada Border Services Agency requires to be serviced in bonded space.
"Our Asia traffic has grown tremendously over the last year, and this new facility allows us to handle the additional business," Gibson reports.
Purolator moved into the building in March. Beyond enjoying improved freight handling efficiencies, the company couldn't be happier with facility amenities such as a pilot's lounge, employee lockers, office space and a lunchroom. "The building is much more ergonomically and employee-friendly than our former building," reflects Mike Boucher, the company's chief operations officer.
Room for interior equipment storage will be especially appreciated during winter, he adds. "We were anxious for Edmonton International to create the new cargo area," Boucher explains. "We've had a long relationship with the airport, and the move has been a pretty good experience."
Another building, owned by Hangar Development, includes 30,000 square feet of office space and 63,000 square feet of hangar space tall enough to accommodate aircraft tail heights up to 28 feet. Already fully leased, the facility houses three medical flight operations: Alberta Health Services, Fox Flight and STARS.
YEG owns the third structure - a 63,000-square-foot building that currently houses the new airport location of the Canada Border Services Agency. Airport officials plan to lease the remainder of the building to cargo and logistics tenants. If demand outstrips capacity, the building can be expanded an additional 15,000 square feet.
The nearby cargo apron is used daily by Cargojet, and Boeing 777s flown by two German FedEx freighter charters are also common occupants. Volga-Dnepr Ilyushin put the new concrete to the test when hauling live bison from Edmonton to Russia.
Late this year, the airport plans to begin road and infrastructure construction for an adjacent cargo village, which is intended to attract freight forwarders, shippers, receivers and similar businesses.
Global Sweet Spot
Geographically, Edmonton is located is a strategic position for worldwide transportation. As Canada's northernmost major international airport, YEG is situated on the Great Circle Route between Asia and North America, making it an ideal refueling stop for trans-Pacific air traffic.
For sea shipments, Edmonton offers easy access to the North American seaport at Prince Rupert, British Columbia. For rail, it links with two of the largest railways in North America - Canadian National and Canadian Pacific - and provides rail connectivity to locations throughout the continent. In addition, Edmonton is positioned near the vast highway infrastructure of the CANAMEX corridor, a trade route that runs through Canada, the United States and Mexico.
YEG, in particular, is adjacent to the Leduc-Nisku business/industrial park, the largest energy park in Canada and the second largest in North America. It is also the closest major airport for the oil sands industry and Alberta's manufacturers.
"We want to make sure those routes to the target markets are in place here at Edmonton," Richard says. "Our trade market is very global. The cargo volumes have been excellent."
Beyond its infrastructure upgrades, YEG further demonstrates its commitment to air cargo by engaging with the local, national and international air cargo community. September 25 to 26, the airport will co-host the Roads, Rails and Runways Conference with the Canadian International Freight Forwarders Association.
More than 200 representatives from Canada's $11 billion freight forwarding industry are expected to attend the event. Airport officials say the conference will showcase the rapidly expanding economies of Central/Northern Alberta and the Canadian North, as well as growing trade and investment with Asia and the European Union.
If economic forecasts bear out, the expandability YEG built into recent cargo area improvements could prove to have been critical foresight, notes Richard.
A March report by the Royal Bank of Canada Economics Research predicts that Alberta's "impressive boom" will continue through 2013 and crude oil production will be stronger this year than last. The report also points to a steady upswing of employment and notes that high levels of capital investment in the province are fueling manufacturing activity and wholesaler activity.
"Alberta is leading Canada in many aspects of economic development," Richard relates. "Edmonton International is positioning itself to be a viable option for the manufacturers and suppliers of the province."
Hangar Development and TerraCap apparently share the airport's optimism, as both are already considering constructing other buildings in YEG's new cargo area. "We have additional lands available," reports TerraCap's chief investment officer Wayne Humphries. "As soon as we get the next couple of deals in place, we will build another facility at Edmonton."