Regina airport looking for route to recovery from pandemic

The Regina airport is trying to find ways to recover from a “catastrophic” year after running out of money due to the effects of the COVID-19 pandemic.

An update on its financial situation that was given by the Regina Airport Authority during its annual general meeting on Wednesday showed revenue was down 52.3 per cent in 2020 compared to the previous year.

Ongoing liquidity is the biggest risk currently faced by the authority, which does not generate enough revenue to pay its debts. Expenses exceeded revenue by $12 million and the airport is now being run on a line of credit.

Part of its recovery plan is to focus on non-aviation-based revenue, which includes food and beverage, parking, rental cars, advertising and leasing its land. Authority CEO James Bogusz explained land development will be an anchor in terms of revenue, contributing to the tax base for the city, and creating good jobs.

“These would be things that would actually support customers who use our facility on more of a retail basis to sell you products. It could be a fuel station (and it) could be other things. Even a hotel in the long term could be in the forecast,” said Bogusz.

To create more space for development, the airport is looking at realigning its frontage road off Lewvan Drive. It has been actively marketing and looking for businesses that may want to lease.

Bogusz couldn’t mention any brands or names but said the authority has had some success and hopes to do some work in the coming months to open up those lots.

There’s also optimism for summer travel as more people get vaccinated and following the announcement this week of Saskatchewan’s reopening plan. Bogusz said airlines are counting on a recovery and a relaxation of travel restrictions.

He explained the Regina airport is in a good position because it did its part to run a prudent operation during the pandemic.

“I want you to be proud that this airport maintained a low-cost, zero-fee increased model … and that’s why we kept WestJet and Air Canada in our market the entire time,” said Bogusz.

Flair Airlines has also returned, offering flights to Toronto and Vancouver. This summer, Air Canada is adding two new routes to Montreal and Kelowna which will run until around Labour Day.

As for the return of international flights, Bogusz said that’s still tough to predict. While he’s seeing optimism in the U.S. with travel volumes exceeding 60 per cent daily, he believes we’ll see a Canada-wide push for tourism and travel well before the promotion of international travel.

As things start to look up by the summer, the airport will also be facing a level of debt it has never had before.

“Coming into June or July, we’re going to be into a situation where we’re in debt over $5 million and that becomes quite a concern for the authority,” said Bogusz.

During the pandemic the airport did receive $1.2 million from the Canada Emergency Wage Subsidy and $114,000 for 10 months of rent relief but not enough to address its growing debt.

In the short term, the airport is depending on more support from the federal government. It’s applying to two federal programs, including the announcement in the fall which provides liquidity to airport authorities across Canada.

“We fully hope and anticipate some of this will (happen) in the very near future to help reduce the additional debt burden. Otherwise it’ll take years to pay back and all that means is we’re more constrained on how we can help this community rebound and grow,” said Bogusz.