Possible Dilemma

[Aztec Driver]

I am faced with the possibility of either affording my Twin Comanche on my own, or selling it.

My partner has lost his job and I am sure he will not be able to afford to keep up his share of the monthly costs. I don't know if he will want his half bought out or not. I think I can handle buying out his share, and paying for the necessary upkeep, but I would not be able to save up for engine overhauls when the time comes.

Of course, Twinkie is not worth what we have in it. Even with the reasonably good price I got it for, the extra money I put into it, combined with the decline in the light twin market, means it is worth considerably less than we have in it.

Any good ideas what a 1966 PA30B with around 5000 total airframe hours, 1300 SMOH engines and props, mediocre paint, New Aspen single unit, new Garmin 430W, KX155, and new STEC30 with ALT hold is worth? Just can't seem to get a good idea, considering there aren't any like it on the market with the same equipment.

I really do not want to sell, but since I fly so much for Aerotech, I really don't get a lot of time to fly it. I think I put in around 30-40 hours in it in the last year. While 30-40 hours per year is not enough to justify ownership, there just isn't an airplane with the same capabilities that is rentable within a reasonable distance.

Someone needs to turn off my logical mind so I can just pay for the airplane and not justify the cost.

 

[SkyHog]

Maybe offer up shares on TAP? I bet, in the Philly area (I think that's where you are), you can get some nibbles on that. Rather than going for a single partner, go for a few. Spread the cost out even more (and reduce your cost too).

Just an idea.

 

[dmccormack]

Were you flying at Smoketown Friday evening? Saw a Twinkie in front of us and wondered if it was you...

 

[JOhnH]

Were you flying at Smoketown Friday evening? Saw a Twinkie in front of us and wondered if it was you...

Was this a partnership or a friendship? It doesn't really change much except how you will feel about the solution.

Do you have a buy-out clause in your partnership agreement? If the buyout amount is predefined, then you have to decide if it is worth that price, or if you would be better off selling.

If you don't have a specific clause, then you could offer to let him relinquish his share of the plane in exchange for you assuming operating expenses by yourself. If it is truly not worth what you paid for it then perhaps he should pay you something to take it off his hands. Then you have the option of looking for another partner.

 

[bbchien]

This is a real problem. Sigh.

Once you get it the way you want it.....then you take a bath.
Or it becomes yet another double runout on the market.....and this is how it happens.

 

[Aztec Driver]

Were you flying at Smoketown Friday evening? Saw a Twinkie in front of us and wondered if it was you...

For a few minutes in the evening. I missed Twinkie and decided to take a few minutes and refamiliarize myself with her. Had an RV enter the pattern in front of me, and then lost sight of it. Had a Cherokee coming in behind me, and since I lost sight of the traffic ahead, I decided to depart the pattern and re-enter from the 45. Didn't want to be barreling down someone's tailpipe without them in sight. It was actually pretty busy that evening.

 

[Aztec Driver]

Was this a partnership or a friendship? It doesn't really change much except how you will feel about the solution.

Both. It is an easy going partnership. Whatever solution I come up with will be fair, even if it costs me a lot of money.

Do you have a buy-out clause in your partnership agreement? If the buyout amount is predefined, then you have to decide if it is worth that price, or if you would be better off selling.

No buyout clause. I can pretty much do as I want, since, technically, it is solely owned by me. He did, however, pay me for half the original price and a small portion of the upgrade. I just haven't been able to find a way to change the registration without paying more sales tax.

If you don't have a specific clause, then you could offer to let him relinquish his share of the plane in exchange for you assuming operating expenses by yourself. If it is truly not worth what you paid for it then perhaps he should pay you something to take it off his hands. Then you have the option of looking for another partner.

This is one option I was bandying about. It would end up being a slow payoff of his share. Regardless of what the plane is currently worth, I will pay him what he paid out. And that price would not change even if it was worth more now than what we paid for it. That would only change if an outsider was involved somehow.

 

[JOhnH]

I will pay him what he paid out. And that price would not change even if it was worth more now than what we paid for it. That would only change if an outsider was involved somehow.

I suspect this is the solution that will allow you to sleep best. After all, very few of us get into this airplane ownership thing as an investment. At least for me, it is a quality of life expense. But I might suggest that you at least allow him to make the first offer. It will probably be a better solution than you would ask for in the first place. I have found that is how it usually works for me. Sometimes my wife says I am too generous. Other times she says that is why she married me.

 

[Aztec Driver]

This is a real problem. Sigh.

Once you get it the way you want it.....then you take a bath.
Or it becomes yet another double runout on the market.....and this is how it happens.

With the economy progressing the way it has been, I have been wondering what the future holds for my flying anyway. I have been fairly sheltered from the problems experienced by others over the last several years. With my part time charter flying gig, I get my flying fix more than I need, but I really do enjoy the Twinkie, especially now that it has all of the nice gizmos.

I do not want it to be a "double runout on the market." But laying out 40-60K near retirement years with little or nothing saved up over he years would not be a fun prospect.

 

[AdamZ]

...



This is one option I was bandying about. It would end up being a slow payoff of his share. Regardless of what the plane is currently worth, I will pay him what he paid out. And that price would not change even if it was worth more now than what we paid for it. That would only change if an outsider was involved somehow.

Thats good Bryon it shows that you are both honorable and a good friend. Without changing the registration you could really put your friend over the barrel. So some thoughts for a solution.

1) Do you really need to buy him out? Perphaps you can sell his share for him or don't buy him out but rather deduct 50% of the amount you spend for annual and certain fixed expenses from the amount that you would pay him for his share. Over time he will avoid expense and you will have a less expensive and cash flow friendlier way of paying him out.

2) If he is still able to fly and you can pick up the fixed expenses have him pay a higher hourly rate to fly the plane.

3)Look to start a small club that can pay you a decent dry rate to deflect some of your expenses.

4) Call Kent Shook and sell it to him.

I'll PM you with some other ideas.

 

[dmccormack]

For a few minutes in the evening. I missed Twinkie and decided to take a few minutes and refamiliarize myself with her. Had an RV enter the pattern in front of me, and then lost sight of it. Had a Cherokee coming in behind me, and since I lost sight of the traffic ahead, I decided to depart the pattern and re-enter from the 45. Didn't want to be barreling down someone's tailpipe without them in sight. It was actually pretty busy that evening.

OK -- I was right behind you in a rather well-traveled C150.

I think the RV you saw was the one I had issues with about an hour later...

 

[Aztec Driver]

OK -- I was right behind you in a rather well-traveled C150.

I think the RV you saw was the one I had issues with about an hour later...

Well, not to speak to ill of anyone, because I make mistakes too, but he called "5 miles SW," and since I was on a wide crosswind, was looking for him ahead and right. 15 seconds later he called 1.5 mile left downwind and I swiveled around and caught a glimpse of him left and low. Darn, fastest RV I ever saw! Unfortunately, I lost sight of him and didn't want to run up his backend.

What "issues" did you have. He departed shortly after I landed and circled the airport while another experimental took off, and they flew off together in a loose "formation."

 

[Aztec Driver]

Thats good Bryon it shows that you are both honorable and a good friend. Without changing the registration you could really put your friend over the barrel. So some thoughts for a solution.

1) Do you really need to buy him out? Perphaps you can sell his share for him or don't buy him out but rather deduct 50% of the amount you spend for annual and certain fixed expenses from the amount that you would pay him for his share. Over time he will avoid expense and you will have a less expensive and cash flow friendlier way of paying him out.

This is the most beneficial option, I think. It allows him to avoid ongoing expense, and still have the option to fly, if he gets another job and has some money to fly again. It also keeps the airplane in known hands. There are very few people I trust to treat my baby in good condition.

2) If he is still able to fly and you can pick up the fixed expenses have him pay a higher hourly rate to fly the plane.

That is one option, but I don't think he will be able to fly, and I certainly don't want him to feel guilty and pay for flying when he should be using the money for him and his daughter.

3)Look to start a small club that can pay you a decent dry rate to deflect some of your expenses.

That isn't an option I desire. Like I said, there are only a few people I would trust.

4) Call Kent Shook and sell it to him.

Yea, but he won't want to pay more than it is worth, besides, he wants to buy the slower ones with the ice protection and all of the other power grubbing attachments!

 

[flyingcheesehead]

I am faced with the possibility of either affording my Twin Comanche on my own, or selling it.

Oof. Sorry to hear that.

Any good ideas what a 1966 PA30B with around 5000 total airframe hours, 1300 SMOH engines and props, mediocre paint, New Aspen single unit, new Garmin 430W, KX155, and new STEC30 with ALT hold is worth? Just can't seem to get a good idea, considering there aren't any like it on the market with the same equipment.

"Worth" depends what you mean. I would say that for an asking price, you're probably looking in the upper $80's, low $90's. Compare with this one: http://www.controller.com/listingsdetail/detail.aspx?OHID=1208361 Trade a fancy paint job for the Aspen, and it's fairly similar to your bird. One engine slightly higher time, one much lower, asking $90K.

Looking on the higher end, there's one going for $100K that's got the full Miller conversion and R/STOL. Lower and they're missing some of the toys.

What it's worth in an actual sale, who knows.

What it's worth to you to keep, only you can answer.

But if you need someone to babysit it for a while, let me know.

 

[Kaye]

Sure wish you lived closer...not that I have a ME, but I could fix that real fast!

 

[bbchien]

.....
Yea, but he won't want to pay more than it is worth, besides, he wants to buy the slower ones with the ice protection and all of the other power grubbing attachments!

...(!!).....

 

[gprellwitz]

Well, if you're flying it less than 50 hours/year, it really does need to be flown more. Kent would be willing to do that for you for a small fee, and would furthermore be willing to get his MEI and get Leslie and me our multi commercials. Then we'd look to purchase it!

 

[Tom-D]

Place the aircraft in preservation.... for ? time period.

 

[Ted]

What if you made some arrangement to cover his share of the monthly expenses until such time as your partner got his job back?

At 1300 SMOH and 30-40 hours per year, you're looking at, what, 20 years or so you overhaul the engines, unless something happens in the mean time. Yes, the engines will be more than based the years on TBO, but nowhere near the hours.

The question really comes down to one of what you want to do. I don't know what arrangement you have with flying the Aerostar if you wanted to use it for personal, but I'm guessing it wouldn't be very practical to do. Given that, the Twinkie is probably the plane to use for that. You've put enough into it that if you sell it, someone else will get a very nice plane and you won't get the money out of it. My thought is that, if you intend to continue using GA for personal purposes, you should keep the aircraft. I'd work with the partner on this, unless the job loss is looking to be permanent. If you're willing to buy him out, what's the harm in a little grace period while he looks for a new job?

 

[Aztec Driver]

What if you made some arrangement to cover his share of the monthly expenses until such time as your partner got his job back?

At 1300 SMOH and 30-40 hours per year, you're looking at, what, 20 years or so you overhaul the engines, unless something happens in the mean time. Yes, the engines will be more than based the years on TBO, but nowhere near the hours.

The question really comes down to one of what you want to do. I don't know what arrangement you have with flying the Aerostar if you wanted to use it for personal, but I'm guessing it wouldn't be very practical to do. Given that, the Twinkie is probably the plane to use for that. You've put enough into it that if you sell it, someone else will get a very nice plane and you won't get the money out of it. My thought is that, if you intend to continue using GA for personal purposes, you should keep the aircraft. I'd work with the partner on this, unless the job loss is looking to be permanent. If you're willing to buy him out, what's the harm in a little grace period while he looks for a new job?

This is the track I think would be the best method. Hopefully, he doesn't need the money immediately.

I am occasionally able to use one of the Aerostars for personal use. Generally, however, one of the Aerostars is in the shop for an extended time while we fly the other one. My wife really likes the Aerostar.

My wife and I have agreed that we will take over his monthly fixed expenses and reduce his share slowly until he gets back on his feet.