The terminal at Bay of Islands Airport is due to be expanded next year to cater for growing passenger numbers.

A record 87,000 people flew in to or out of the airport last year, an increase of a third since Air New Zealand started flying larger aircraft on the Auckland-Kerikeri route.

Council-owned company Far North Holdings, which owns and operates the airport, said work to expand and upgrade the terminal would start in the second quarter of 2017 if its building consent application and the tendering process were successful. The project was expected to take about 10 months.

Chief executive Andy Nock said the expanded terminal would have automated check-in, roomier departure and arrival areas, and a separate luggage collection area.

Advertisement

During the project the check-in and departures area would be moved into space currently used by the Bay of Islands Aero Club.

Mr Nock said Air New Zealand's withdrawal from Kaitaia had boosted passenger numbers at Kerikeri but most of the growth was due to increased tourist and business traffic between Auckland and the Bay of Islands.

A close partnership between Air New Zealand and the Bay of Islands Marketing and Promotions Group, a coalition of tourism and hospitality businesses, was also having an effect.

"We're expecting traffic to continue growing by about 20 per cent a year for the foreseeable future, with an equal mix of business and leisure travel. With these sorts of numbers it was essential we did something to improve and streamline facilities at Bay of Islands Airport. I think anyone who's used the airport in recent times can appreciate that," he said.

The expansion will be funded on a commercial basis, which means ratepayers won't pick up the tab. Far North Holdings won't disclose the expected cost until the tendering process is complete.