Introduction
Before hangar construction, you must assess the current state of your airport or airpark, how well it operates, and the viability of new hangar construction. This will include qualifying the demand and need for aircraft hangars, assessing the environment in which the project will be executed and obtaining support from any key decision makers. You should also become familiar with the FAA requirements and regulations that govern airport development and aircraft hangar construction.
Before going any further identify the key personnel who can help you. These people could include
- airport directors
- city officials
- airport engineers
- airport consultants
- local EAA organization
- other hangar owners
Preparations: Do Your Research
Begin by doing a study of the aircraft hangar waiting list. If your airport does not have one then consider making one to learn if there is any demand for hangar space. Contact those who show interest, find out their level of commitment and their future plans and how much are they willing to spend. This is your market research. Are they interested in other locations? Some people have their names on multiple waiting lists across the state. Do they own an aircraft at this time? However you choose to qualify these people it must be verified.
Another way to gauge the interest of people on a hangar waiting list is to request a financial deposit from each registration.
The type of aircraft hangar will depend on your tenants and what is the most appropriate at your airport. For example, nested T-Hangars attract renters because they provide the greatest degree of protection from the weather for the least amount of return. Box hangars usually attract owners with more money and bigger aircraft. These hangars are often more expensive to build, but they also generate significant revenue and should last a lot longer. Box hangars can also be designed to offer wash facilities, a conference room or space for repairs and overhaul.
Key Considerations
- Hangar doors are not sitting in warehouses waiting to be bought like a garage door. They are designed and manufactured to order so ask about the lead time for engineering blueprints, manufacturing and delivery.
- The quote you receive will not include any exterior sheeting, interior liner, insulation or trim. You must source this from your building manufacturer or another supplier.
- Some hangar door manufacturers exclude any electrical scope of work in their installation bids. (This is the electrical wiring on their own door).
- There are different levels of horizontal deflection allowance that the door can be designed to. The most common are L/120, L/180 and L/240. A door designed to L/120 will be less expensive than a door designed to L/240.
- Hangar door quotes typically do not include any sheeting, trim or insulation.
Researching the environment in which you plan to build is probably the most important element that can be overlooked. Airport supporters often assume that if the demand for aircraft hangar space is large, then the development will be simple and successful. Not always! Before you seek any funding you must research all of the elements in the airport. These elements include:
Airport Owner Support: If you don’t have the support of the airport, you will be fighting an uphill battle. Whether it’s a private or public airport, you are going to need their help and support to be successful. We recommend you identify the key decision makers early on and introduce yourself and your plans for aircraft hangar construction. You will want their support to earn favorable decisions! Key people to reach out to include the airport manager, the planning department and senior City or County members. If an airport commission exists contact them too!
Community Supporters: If the community doesn’t back your project it will be much more difficult. If the airport has been good to the community in the past you should find yourself sitting favorably with them. Do not assume just because your ideas are not lodging complaints from the community that you have their support. Check with online community message boards, the local newspapers and local residents to find out what people think of your plans.
Airport’s Master Plan: The airport should have an up to date master plan that is approved by the FAA and shows the build out capacity of the airport and the plans for how it should be achieved. It also shows an airport layout diagram. It’s critical that your aircraft hangar project is highlighted on this master plan in the planning phase.
Zoning or Land Usage: The airport or City will have a plan of which airport owned land can be developed. Some areas will be available for aircraft hangars, some for commercial development, gas, combinations etc etc. Some will need to be listed as free space and must remain free from any development or construction. If a zone does not already exist for hangar development then you will need to consult the Airport director. AOPA will also be a useful contact: talk to their Noise and Land division.
Design Standards: Design standards do not apply at every airport so you will need to find out. Some airports will have preferred architects and engineering consultants for aircraft hangar design. These firms will have a good grasp on building sizes, shape, design, door styles etc. They should be given AeroDoors contact information at a very early stage to ensure the right choice of door is utilized. The airport director may have a list of “preferred design agencies.”
Tenant Support: Although people on the aircraft hangar waiting list may be anxious for you to complete your development, others may not show the same enthusiasm. For example, an existing hangar developer at the airport may see you as a threat. It’s important that you determine the competition and seek the advice of others. You should know how much support you need to overcome the competition.
Availability of Funding: Existing airport revenue will be the main source of any funding. Examples include state aviation funding, municipal bonds, or private loans. Check out the FAA Airport Improvement Program.
Conduct a Stakeholder Analysis
A stakeholder is any person or group who has an interest in or will be impacted by the hangar project. Once you have identified the stakeholders you should determine their level of support. This will help you manage the level of acceptance and commitment for your project because strong allies can influence those who show little support.
Keep in mind that the stakeholder analysis likely will change over time as issues are addressed or new stakeholders are identified.
Hangar Construction
Theres a number of approaches to aircraft hangar construction. Each has it’s advantages and disadvantages so you will need to consider the options to determine which is best.
We believe there are 3 main choices:
- Private company snaps up the land on a twenty something year lease, and rents the hangars to tenants.
- Private developer snaps up the land on a twenty something year lease, and rents the hangars to tenants.
- Airport owns the aircraft hangars and rents them to tenants.
Private Ownership vs. Airport Ownership
Advantages
- Private Company or Developer
- No outside investment required
- No owner management required
- Deal with one person
- No occupancy risks
- Airport Owner
- Strong demand
- High flow of revenue
- Build to your own specifications
- You can ensure compliance with laws and airport rules
Disadvantages
- Private Company or Developer
- Limited control over lease or rent increases
- Asset depreciation
- Managing hangar waiting lists can be problematic
- Airport Owner
- Airport owner management oversight required
- Potentially the highest capital cost
- Maintenance costs come from airport budgets
Financial Impact and ROI
Generating money is the primary goal for any General Aviation Airport, so having the airport owner fund, build and manage a hangar project is frequently the best approach. If the owner is not supportive, then finding a private source for funding, construction, and operation will be the most attractive alternative. The key will be your financial analysis.
After exploring the alternative approaches, it is critical to assess the financial impact of each on the airport’s operation. Take the past financial history of the airport’s operation, include the impact of the new hangars, and project the result.
You will need to get budget-type estimates for the various alternatives you reviewed in the prior step. Look into revenue, operating expenses, and capital costs/loan obligation payments. Remember to include an estimate of increased fuel sales revenue (and the other miscellaneous items that would increase) based on the number of aircraft based at the airport. A cost-effective source for such information can be obtained from prior projects at your airport or neighboring air- ports, adjusted for inflation and differences in scope. Use an airport consultant or engineering contractor to generate budget type estimates.
Once you have gathered the pertinent information, run the financial projections out at least 10 years, applying inflation-based adjustments for operating expenses and revenues. During this 10- year period, you likely will see that existing loans may be fully paid off, generating the potential for increased positive cash flow and other benefits. These are all important to document in the final business plan as justification for the project.
Hangar Construction SWOT Analysis
The purpose of determining the project’s strengths, weaknesses, opportunities, and threats (SWOT) is to uncover the impact that your hangar project will have on the airport’s stakeholders. It is helpful to have a group of project proponents working together on the SWOT analysis and inter- viewing key decision makers or stakeholders—this can uncover potential issues more quickly than doing it alone. Typically, you will discover things that you can use to your advantage or issues that you can address in the early stages of project planning to limit their possible negative impact.
Once you have completed the SWOT analysis, you will have a better idea of where to focus your energy as you start persuading the decision makers and other stakeholders to become supportive of the project. If you are fortunate, you might not have many worries in this regard, but it is best to be forearmed.
- Strengths
- History of success
- Waiting list of aircraft hangars is full
- Support of local township and stakeholders
- FAA funding is available
- Weaknesses
- Airport director has limited experience
- Tenant resistance
- Lack of owner support
- Neighbors are resisting
- Opportunities
- Increased revenue for the airport
- More satisfied airport customers
- Increased airport business opportunities
- Transport improvements
- Threats
- Obstacles from current tenants
- Community resistance
- Airport funding is managed by Congress
- Developer has conflicting interests
Understand Boundary Conditions
These are nothing more than the givens surrounding the project. They set what is in bound and what is out of bound. In any project there will be constraints that you won’t be able to change or modify. Finding these during your planning stage will save you time and money down .
- FAA and State funding
- Architectural designs need review and approval.
- City must endorse project plan and contract awards.
- Lease agreements must be negotiated with some current airport tenants.
- Neighbors must be included in communication.
- Airport restrictions on hangar design.
- Owner won’t provide any source of funding (so it must be self funded).
With the boundary conditions identified, you might find more issues that need to be con- sidered as you put together the business plan and deal with stakeholders during project exe- cution. It is key to determine who will be the decision maker, from whom or what group you will need approvals, and whether this will change at various points during the project.
Create a Business Plan
Even if you don’t face all of the issues explained in this guide or need to create an elaborate business plan for your key decision makers, you still should go through these steps. A business plan will assist you throughout the project and will help it run more efficiently.
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