IMPORTANCE OF A LONG TERM LEASE
Leases for unimproved land at an airport commonly include a requirement that, within a certain time period, the operator must construct a specific, approved type of building to accomodate an approved list of services. This generally depends on what the airport may need at that time and on demand for airport land. So once the lease is signed, the new tenant must finalize architectural drawings, obtain permits, and more importantly, secure the needed financing.
"As a result of the huge investments required, such improvements normally are financed to a large degree by borrowed funds. The usual sources of loan money, such as banks and other industrial lending institutions, lack enthusiasm for advancing funds upon improvements to be installed on publicly owned land simply because of the limiting characteristics of these improvements as collateral; improvements upon lease property are not readily marketable in the event of a default on the loan and subsequent foreclosure" - Reference: "The Importance of a Long Term Lease in Aviation Agreements" National Air Transport Association.
Leases for unimproved land at an airport commonly include a requirement that, within a certain time period, the operator must construct a specific, approved type of building to accomodate an approved list of services. This generally depends on what the airport may need at that time and on demand for airport land. So once the lease is signed, the new tenant must finalize architectural drawings, obtain permits, and more importantly, secure the needed financing.
"As a result of the huge investments required, such improvements normally are financed to a large degree by borrowed funds. The usual sources of loan money, such as banks and other industrial lending institutions, lack enthusiasm for advancing funds upon improvements to be installed on publicly owned land simply because of the limiting characteristics of these improvements as collateral; improvements upon lease property are not readily marketable in the event of a default on the loan and subsequent foreclosure" - Reference: "The Importance of a Long Term Lease in Aviation Agreements" National Air Transport Association.
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LENGTH OF AIRPORT LEASES
If a ground lease tenance is to put up a building, together with required infrastructure improvements, commercial financing is almost always required. This means that a lease of 25-50 years is needed to assure the lender that the investment is sound. Thus, requiring shorter-term ground leases at the time of initial construction is not a productive approach to airport management.
If a ground lease tenance is to put up a building, together with required infrastructure improvements, commercial financing is almost always required. This means that a lease of 25-50 years is needed to assure the lender that the investment is sound. Thus, requiring shorter-term ground leases at the time of initial construction is not a productive approach to airport management.
$70 Million in New Investment
$382 Million 20-Year Impact to Ormond Beach
1800 20-Year Total New Job Effect to Region
$2.0 Million New State & Local Taxes Upon Completion of First Year of Operations
Robust Operations Facility - Not Just Aircraft Storage Hangars
800 Years Total Airport
Development, Engineering & Aviation Team Experience
100+ Years Total Military Command, Control, Operational, Flight & Ground Experience
Robust Aircraft Noise Abatement Program
Protects City from Financial Risk and Liability
No Ormond Beach Funds Required for Financing of Development
$382 Million 20-Year Impact to Ormond Beach
1800 20-Year Total New Job Effect to Region
$2.0 Million New State & Local Taxes Upon Completion of First Year of Operations
Robust Operations Facility - Not Just Aircraft Storage Hangars
800 Years Total Airport
Development, Engineering & Aviation Team Experience
100+ Years Total Military Command, Control, Operational, Flight & Ground Experience
Robust Aircraft Noise Abatement Program
Protects City from Financial Risk and Liability
No Ormond Beach Funds Required for Financing of Development
