Bombardier preparing for departure from Toronto’s ‘aerospace hub’

Share

Bombardier Inc. is looking for a buyer for its sprawling aircraft-manufacturing site that employs thousands in Toronto, raising alarms among city politicians keen to protect jobs and stop land zoned for employment from being converted into housing.

The company's 375-acre site in Downsview, near York University, is part of a government-underwritten "aerospace hub" that includes a Centennial College facility now under construction. Bombardier and its subsidiary de Havilland have been there for almost 90 years.

A spokesman for Bombardier said the potential move was part of a long-term turnaround plan for the transportation giant. Olivier Marcil stressed that no final decision has been made on whether the company would relocate its operations or, if it did, where it would set up, though Pearson International Airport would be an obvious contender.

"When we look at the Downsview site, it's clear it's an asset that could be leveraged," Mr. Marcil said Friday, noting that the company is testing the waters and has found some interest in the real estate.

"The Mayor's office is aware of Bombardier's plans to shift production away from Downsview," spokesman Don Peat said in a statement.

"We have been in discussions with the provincial and federal governments as to how to protect – and even grow – jobs at Downsview and protect public investments made there over the years."

The local councillor has warned the company that the city would not stand idly by if Bombardier struck a deal with a developer.

"We are committed to doing everything possible to protect our employment lands as they are an integral component to the City's success," Councillor Maria Augimeri wrote recently in a letter to Bombardier CEO Alain Bellemare and a number of politicians. A copy of the letter was obtained by The Globe and Mail.

Rezoning is a politically fraught process. Under the provincial growth plan, Toronto has a city-wide target for jobs and people per hectare. If the city wants to rezone an employment site, it has to demonstrate that doing so will not prevent it from meeting its citywide target.

Mr. Marcil pointed to the increasing density around the Downsview site and the transportation links that have been built, including infrastructure such as a brand-new subway stop, suggesting that some form of mixed-use development could fit there.

"It may make sense from a societal standpoint to use that property for uses other than aircraft manufacturing and testing," said David Tyerman, an analyst with Cormark Securities in Toronto, noting that the land is likely fairly valuable if Bombardier can find a buyer other than the government.

"They're trying to get the cost structure of the company down and [consolidating production at another site] might be a logical way of doing that."

Production at the Downsview site is dedicated to the Q400 turboprop and jets from the group of aircraft dubbed the "Global family." The site employs about 3,500 people and has a runway but is, Mr. Marcil said, far bigger than the company needs. He noted that the company requires access to a runway for operations but doesn't need to own it.

The union did not return calls this week.

In her letter, Ms. Augimeri accused the company of breaking faith.

"It is regrettable that after so many millions of public dollars have been spent on the creation of an Aerospace Hub on the Downsview Lands, that the lead member of the group will walk away from the site and all of our investments," she wrote.

Barely a year ago, Centennial College broke ground on a $72-million aerospace campus at Downsview. The facility, which is expect to open this fall, received about $18-million in funding from Ottawa and about $26-million from Queen's Park.

Andrew Petrou, the executive director of Downsview Aerospace Innovation and Research at Centennial College, said the facility, which would mean a doubling of students and a tripling of space, was "not contingent" on Bombardier's continued presence.

Mr. Marcil said the company could continue to be involved in activity at the aerospace hub, particularly if its jobs relocate to Pearson, which is only a short distance away.

With a report from Nicolas Van Praet in Montreal.