Buying a HANGAR?

n2230b

n2230b

Pre-takeoff checklist
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fast eddie
Thinking about buying a hangar. Paying $210/mo for tiedown currently but...just painted the airplane. Monthly hangar rates at KPMP and KFXE, (my closest airports) run +/- $750/mo. A $100,000 hangar, with a small dn pmt and 25 yr mortgage could run $450/mo. Any thoughts on this expensive-new paint protecting approach?
 
Sounds like a good investment. If you ever sell the plane, you could rent the hanger and make $$$$

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IMHO...if you can afford it (and maybe even if you can't) GO FOR IT!! Insurance will be lower, risk of hail damage = zero (oh, you are in Florida...maybe you guys don't get hail), risk of vandalism = zero, risk of rain in cabin = zero, etc. If you have the ability to sell it in the future then you should get your $$ back. Is there "ground rent" applied to privately owned hangars? If so, any long term guarantees?
 
Considering the high rent in your area, this might make sense. 10 years down the road, you however might or might not be able to rent our your own hangar for $750 or recover your investment: At least in our area, most aircraft owners are WELL into their retirement with very few younger pilots following. Personally, I am expecting a sharp decline in aircraft owners over the next 10 - 20 years.
 
Where are you planning to build the hangar? If a public airport, there will be a land lease payment on top of the cost of the building. If hangar rent is that high, I can imagine land being at a premium as well
 
The big concern would be the land lease, not only how much it costs, but also how long is it?

When the land lease ends, the airport can choose not to renew and end up with whatever is left there (like the hangar itself). The airport can choose not to renew land leases only to then lease out the hangar (that was built by the previous tenant) at the market rate.

But also read the lease for the benefits it may offer, for example, the land lease may allow you to build a pilots lounge with a/c and plumbing, which would be nearly impossible in a rented hangar.

Having said all of that, if the lease checks out, and it can be financed. I would consider it in your position.
 
Arrow76R said:
IMHO...if you can afford it (and maybe even if you can't) GO FOR IT!! Insurance will be lower, risk of hail damage = zero (oh, you are in Florida...maybe you guys don't get hail), risk of vandalism = zero, risk of rain in cabin = zero, etc. If you have the ability to sell it in the future then you should get your $$ back. Is there "ground rent" applied to privately owned hangars? If so, any long term guarantees?
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German guy said:
Considering the high rent in your area, this might make sense. 10 years down the road, you however might or might not be able to rent our your own hangar for $750 or recover your investment: At least in our area, most aircraft owners are WELL into their retirement with very few younger pilots following. Personally, I am expecting a sharp decline in aircraft owners over the next 10 - 20 years.
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Many thanks! Great observations.
There is a monopoly that controls almost all hangar and tiedown availability at both PMP and FXE.
I would have to triple my driving time to reach an airport where I could buy a hangar, KHWO, although still worth the travel inconvenience for the right hangar at the right price. Will investigate further, more to follow.
 
+1 on understanding the lease. Ideally there would be N years with wording in the lease for at least one more of X years. Otherwise it's value declines as the lease runs out...but still worth it in many cases if it was more protection than being outside.

Also, financing on a hangar with a standard bank may not be possible as the bank can never own the land under it.

We just put in a purchase agreement for a hangar. In our case there is about 80yrs remaining on the lease which was a strong motivator. We also found it cheaper to buy an existing one than build new. It wont be as nice or heat efficient as new but were okay with that.

If you use a HELOC to finance I think it must exceed a certain amount for a tax deduction on the interest.

And then there are the other fees - tax, insurance, electrical, etc.

You can always hang up adds asking to rent from a private hangar owner. Some are hungry for rental income.
 
@ $40 a month for hanger rent I'm happy (includes electrical service.) . But it is 40 miles away . :(
Thinking of building one here on Farm for summer storage.
Winter @ current hanger is nice . It's plowed to with in a foot of doors.
 
n2230b said:
Any thoughts on this expensive-new paint protecting approach?
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It's not just paint protecting. UV light can damage avionics and other interior items.

So you should go for it . . . :)
 
Talk to other hangar owners about expenses besides a mortgage payment. That could be taxes, hangar insurance & whatever else. Then run that cost against your rent.

At my level I do the rental, yes, ownership would be nice.
 
$210/month for tie down? Holy smokes! Things are expensive around my area, but tie down is only $45 in the summer, $75 in the winter.
 
I sold a T hangar at one airport and bought another at a different airport. The sale prices were nearly identical but the one I have now is a full hangar that holds two airplanes instead of one and has a full concrete slab, so it's MUCH less humid, along with a few other advantages. I suppose the biggest downside is that there are no lights or instrument approaches at the new airport, but if I ever need either of those I'd just fly to the old airport and arrange ground transport.

But being able to fit two planes in one hangar is a big plus, if you can get that option.
 
Typical land lease will cause the building to revert to them at the end of the lease. Yeah, you could wind up with the lease expiring and then have to pay to rent the hangar that you built.
 
Stewartb said:
Move to an airpark. Live with your plane. Consolidate expenses like mortgage, insurance, and utilities.
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From a pilot’s perspective, the concept of living on an airpark seems like the Holy Grail... and I used to think so too. So a few years ago, we made the jump and did the airpark thing. Bought a 2+ acre lot on a large grass strip. Built a house plus a Morton pole barn type hangar with room for a small fleet of RV-8s. Heaven, right? Ehh, we lasted 4 years there before selling and moving on. Didn’t like it.

The problems there were numerous, but it started out with our custom home builder; not a good guy so the whole process went sideways and sorta colored our thinking of the place for the time we were there. Also, the strip was somewhat rural as they tend to be; with us having no kids and me being an airline pilot and gone half the time, my wife felt isolated and remote. As it turns out, we’re not rural, country living people. Who knew? Then there’s the grass strip and my 2 acre lot; I spent way more time on my zero-turn mower than I did flying my RV... then there was last winter here in SE Texas with rain, rain and more rain. I went 90+ days without turning a prop. Depressing.

The last straw turned out to be some of our neighbors; out of roughly 22 homes on the field, there were a few guys that made life miserable there; a doctor, 4 airline pilots and a local home builder... none of the “normal” residents could stand those guys, but there they were. The airline guys were just insufferable, and that’s coming from me as an airline pilot! Weird.

So, we sold, moved back into town and now I have a crappy T hangar a 20 minute drive away. I miss my big and shiny box hangar with epoxy floor and remote control bifold door and bright overhead lights... but I’m glad to have that crappy T hangar and we’re much happier now.

Choose wisely when looking for an airpark location; we chose poorly and hated the result.
 
MarkH said:
The big concern would be the land lease, not only how much it costs, but also how long is it?

When the land lease ends, the airport can choose not to renew and end up with whatever is left there (like the hangar itself). The airport can choose not to renew land leases only to then lease out the hangar (that was built by the previous tenant) at the market rate.

But also read the lease for the benefits it may offer, for example, the land lease may allow you to build a pilots lounge with a/c and plumbing, which would be nearly impossible in a rented hangar.

Having said all of that, if the lease checks out, and it can be financed. I would consider it in your position.
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The airport is required to take possession and lease at the market rate. That doesn’t mean they cannot offer you a renewal at an increased price.
 
Clip4 said:
If the airport receives FAA grants they are required to take possession and lease at the market rate.
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Not necessarily true. The airport can extend ground leases. But the extension of the ground lease is typically politically motivated, in other words, most ground leases of 20 to 30 years will have a provision to extend the lease before expiration, but in real world experience municipalities are reluctant to extend the lease with a few exceptions.

I have seen a 20 year lease with two 5 year extensions built in (with provisions). Again, anyone considering building or buying a hangar on leased property should consult an attorney.

And for the record, I have owned hangars on federally funded aircraft property.
 
Lachlan said:
$100,000 hangar (plus interest) for 25 years to protect a $20,000 paint job? Makes sense. Send it.
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Assume the plane is going in a hangar regardless

Lets say a $90K loan @ 3.5% = monthly payment of about $400. That saves him $350/month over going rate he cited of $750 (which may/shall go up).

Perhaps he keeps it for 15 years. He will have spent $72,000 (+$10K for downpayment) = $82K on the hangar he built in that time or $135,000 in renting a hangar.

At the end of the 15 years he can sell the hangar and its remaining ground lease time for something.

Kind of makes sense (as much as any of the money we spend flying makes sense! :rolleyes:
 
Doc Holliday said:
Not necessarily true. The airport can extend ground leases. But the extension of the ground lease is typically politically motivated, in other words, most ground leases of 20 to 30 years will have a provision to extend the lease before expiration, but in real world experience municipalities are reluctant to extend the lease with a few exceptions.

I have seen a 20 year lease with two 5 year extensions built in (with provisions). Again, anyone considering building or buying a hangar on leased property should consult an attorney.

And for the record, I have owned hangars on federally funded aircraft property.
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As the airport, I personally don't want to take possession of a 50 year old hangar (our leases are 50 year). I can only imagine how much deferred maintenance there will be when the previous owner knew the end of lease was coming. Roof starting to leak...who cares not my hangar in a few years. Door cables fraying...who cares run it til it breaks, etc. Sure the airport can make a lot more money leasing a hangar than just land, but it comes with a lot of potential liabilities as well.
 
Pugs said:
Assume the plane is going in a hangar regardless

Lets say a $90K loan @ 3.5% = monthly payment of about $400. That saves him $350/month over going rate he cited of $750 (which may/shall go up).

Perhaps he keeps it for 15 years. He will have spent $72,000 (+$10K for downpayment) = $82K on the hangar he built in that time or $135,000 in renting a hangar.

At the end of the 15 years he can sell the hangar and its remaining ground lease time for something.

Kind of makes sense (as much as any of the money we spend flying makes sense! :rolleyes:
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Sure, financially we can justify nearly anything that we want to justify, but wouldn't it make a whole lot MORE sense to have this sort of thing figured out PRIOR to dropping a relatively healthy amount of kibble on a new paint job? Why not get it in the hangar FIRST, then paint it, if that's how you're going to end up? Yeah, yeah, perfect world and schedules at the paint shop and all that noise... the point is, spending a hundred grand for the sake of spending a hundred grand ain't saving money. ;) And, not that it matters, but my cheap little 150 spends 6 months of the year tucked in a pretty cool hangar, so I get it. (But I didn't build, buy, and don't own said hangar. Wish I did, but my wallet disagrees.) :D
 
AKBill said:
At that rate I would move in and sell the house...:)
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Would be better then the house we lived in back in the early 40's . No Electricity on the farm back then.
 
midwestpa24 said:
As the airport, I personally don't want to take possession of a 50 year old hangar (our leases are 50 year). I can only imagine how much deferred maintenance there will be when the previous owner knew the end of lease was coming. Roof starting to leak...who cares not my hangar in a few years. Door cables fraying...who cares run it til it breaks, etc. Sure the airport can make a lot more money leasing a hangar than just land, but it comes with a lot of potential liabilities as well.
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All very true. Again, before buying any hangar on leased land, get an attorney involved and get a copy of the lease. Airport management can put all kinds of conditions into the lease (within the realm of the airport grant assurances) and the new lessee could find himself liable for costly repairs.
 
To the OP- are you buying a already built hangar or building one? I did some small research a few years ago and it seemed like hangar notes were 10 years max. If you are talking about building one, then ignore me. Maybe things have changed?
 
charheep said:
To the OP- are you buying a already built hangar or building one? I did some small research a few years ago and it seemed like hangar notes were 10 years max. If you are talking about building one, then ignore me. Maybe things have changed?
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I just re-read the OPs post, and I think you are right there too. I think most banks will only do a 10 year note on a non-residential structure. Its a business loan not a mortgage.
 
Once your in a hangar you’ll never go back. In addition to the excellent reasons above... Stuff like basic maintenance is a breeze. Nice to have tools, workbench, and parts collocated with the plane. Simple things Lomé buying oil and filters in bulk and storing them, etc.

I was renting a storage locker for $300 a month, and my hangar is $290. I just saved $10 a month storing a few items in the hangar.
 
Doc Holliday said:
Not necessarily true. The airport can extend ground leases. But the extension of the ground lease is typically politically motivated, in other words, most ground leases of 20 to 30 years will have a provision to extend the lease before expiration, but in real world experience municipalities are reluctant to extend the lease with a few exceptions.

I have seen a 20 year lease with two 5 year extensions built in (with provisions). Again, anyone considering building or buying a hangar on leased property should consult an attorney.



And for the record, I have owned hangars on federally funded aircraft property.
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Because the airport management was not current with the law.
 
455 Bravo Uniform said:
What is the value of the plane you’re trying to protect?
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1977 Rockwell Commander 112 TCA .....but....new $16K paint, new leather interior/carpet $6.2 K & new avionics (adsb in-out, G5’s coupled Garmin 355 $10 K). TTAF 2,960 h, TBO 980 h.

Previously owned and hangared a Piper Arrow and later a Piper Seneca. And I agree totally, once you hangar your totally spoiled for life.

Own the Commander free and clear. What the hell! Anybody want to partner up?
 
Just reading up on 5190.6B Appendix A Airport Sponsors Assurances

38. Hangar Construction.
If the airport owner or operator and a person who owns an aircraft agree that a hangar is to be constructed at the airport for the aircraft at the aircraft owner’s expense, the airport owner or operator will grant to the aircraft owner for the hangar a long term lease that is subject to such terms and conditions on the hangar as the airport owner or operator may impose.
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