Canada’s airports open to private investment, paving way for modernization

Canada's airports are now open to private investment, according to Minister of Innovation, Science and Industry François-Philippe Champagne.

Announced Friday (March 7), Minister Champagne released a policy statement on investment for Canada's National Airports System airports as part of a commitment from Budget 2024 to support airports.

The National Airports System is made up of 26 airports, 22 of which are run by private, not-for-profit airport authorities.

While these authorities are operationally and financially independent, the airports themselves are located on land leased from the Government of Canada.

The latest policy statement highlights existing flexibilities under the governance model for Canada's airport authorities to attract investment, including from pension funds.

It outlines three avenues, subleases, subcontracts and subsidiaries, for private investors and developers to collaborate with airport authorities.

The policy statement also indicates that the government intends to explore negotiations to extend airport authority leases to facilitate third party investment and development projects on airport lands.

"Canada's airport operators have built world-class infrastructure, connecting people, services, and goods. As our air sector continues to grow, investment from various sources will be essential to ensure that our airports can meet the needs of Canadians,” stated Minister Champagne. “This policy statement provides clear direction on the many ways private investors can work with National Airports System airport authorities to the benefit of both the airports and the communities they serve."

Airports applaud clarification

Toronto Pearson airport (YYZ) issued a response not long after, applauding the clarification.  

"We welcome this policy direction which clarifies investment parameters at a time when Toronto Pearson is building new infrastructure to address increased demand by passengers, said Deborah Flint, president and CEO at the Greater Toronto Airports Authority (GTAA), which manages Pearson. "As Canada's largest airport we have a plan in place to deliver a world-class passenger experience that integrates smart architecture and unlocks the digital potential in air travel, to allow Pearson to maintain its status as the most connected airport in North America."

Last year, Pearson Airport announced Pearson LIFT - Long term Investment in Facilities and Terminals (LIFT), a capital plan aimed to modernize the facility.

Pearson LIFT also aims to stimulate the economy by creating thousands of jobs and benefit the hundreds of thousands of people who work at Pearson.

ADM Aéroports de Montréal also welcomed the update, saying the statement provides “greater clarity” for planning the next major phase of infrastructure development.

"I welcome the federal government's stated intention to enter into negotiations to extend ADM's lease,” stated Yves Beauchamp, president and CEO of ADM Aéroports de Montreal.

Beauchamp said his organization is ready to begin discussions immediately, as such an extension would facilitate expansion and modernization projects over the next 10 to 15 years “and provide greater certainty for our investors.”

“At the same time, we welcome the clarifications provided on the flexibility of funding sources available to airport authorities,” Beauchamp said. “ADM is open to exploring innovative financing models with private institutional investors, such as Canadian pension funds, to accelerate investment in its facilities for the benefit of users and the community.”

“This will enable the YUL and YMX sites to make an even more sustainable contribution to the socio-economic development of the Greater Montreal area."

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