Construction work has started on a new $16 million multi-tenant cargo facility at Edmonton International Airport.

Edmonton Air Cargo Development Group Limited Partnership will own the building, with the airport providing an additional 22,000sqm of apron space.

Due to open in early 2012, more than half of the cargo facility's 50,000sqft of space has already been leased out, and work on the project will be financed by a partnership between First Nations investment group and Terracap Group, an Ontario-based property development group.

Larry Krauss, president of the Terracap Group, said: "We are delighted to announce a premier cargo facility that will bring the business and commercial aviation experience to a totally new level at EIA.

"The Capital Region's economy is growing and infrastructure like this will be needed to support local businesses."

Edmonton International Airport has put aside $20 million to develop its cargo and general aviation infrastructure and has plans to modernise and relocate all of its cargo facilities.

Reg Milley, president and CEO of Edmonton International Airport, added: "This new cargo facility will help serve the growing need for cargo services in our region and make the Capital Region more competitive."