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Representative Engagements

Eight Matters, and How Each One Is Handled

Hangar and airport valuation problems repeat. The same eight situations account for most of the work: an assessor using the wrong cost table, a sponsor resetting rent, a taking that severs a hangar row, a lender underwriting a leasehold. Each entry below sets out the question, the complication a generalist appraisal misses, and the method that resolves it.

Dr. Clay W. Carter · DBA · CFA · FRM · CAIA · CIPM Assistant Professor · an aeronautical university in Daytona Beach, Florida Author, Valuing Aircraft Hangars, the reference textbook in the field
How to read these

These describe the engagement types this practice takes and the analytical approach applied to each. Facts are illustrative rather than drawn from any single client file, and no figures are presented as outcomes achieved for a named party. Engagement details remain confidential.

Current authority

Reports cite the regulatory framework as it stands today, FAA Order 5190.6C and CGL 2018-3 among the twenty authorities that govern airport rents and hangar value, not the cancelled predecessors an opposing expert checks first.

Published evidence

Conclusions draw on evidence a reader can inspect: the firm's GA Hangar Rent Index, the hangar condemnation tracker, and the published construction cost model.

Built for review

Every method column below is written for the reader who gets it last: a county board, a credit committee, the FAA, or opposing counsel on cross-examination.

By matter type
Property tax Condemnation Rent reset Acquisition diligence Lender collateral FBO sale ESOP Insurance
01

Assessor Values a Corporate Hangar From the Warehouse Cost Table

Property tax appeal · 24,000 SF corporate hangar on airport ground lease · Class C reliever field
Property TaxCost Table RebuttalReversionCounty Board

The question

The county assessed the hangar at replacement cost new less depreciation, treating it as a light industrial warehouse of the same footprint. The owner holds a ground lease with 18 years remaining. Is the assessment supportable?

What the assessor missed

Two things. The cost table prices a warehouse shell, not a bi-fold door system, a reinforced slab rated for aircraft loads, or aviation fire suppression. And it values a fee simple building when the taxpayer owns a wasting leasehold that reverts to the sponsor.

The method

Income approach with the reversion modeled explicitly as an annuity over the remaining term, cross-checked against a component cost estimate built from current steel, door, and sitework pricing. Both approaches are reconciled to the interest actually taxed.

Deliverable: independent appraisal plus a written critique of the assessment methodology, with testimony available if the matter escalates. Hangar property tax appeals → The evidence that wins a tax appeal →
02

Runway Safety Area Project Takes Part of a T-Hangar Row

Condemnation and severance · 10-unit T-hangar row, four units in the take area · Sponsor-initiated project
Eminent DomainSeverance DamageExpert WitnessLarger Parcel

The question

What is just compensation when a taking removes four units from a ten-unit row? The condemning authority values the four units as a pro-rata share of the whole and stops there.

What that misses

A T-hangar row is a single functional unit. Severing it can strand a taxilane connection, orphan the remaining units from apron access, and impair the economics of the remainder well beyond the pro-rata share. Damage to the remainder is the contested issue in most of these matters.

The method

Before and after valuation of the larger parcel, with the remainder analyzed for access, functional utility, and rentability after the take. Comparable outcomes drawn from the firm's tracker of verified US hangar condemnation and inverse condemnation matters.

Deliverable: appraisal to the standard the tribunal expects, plus rebuttal of the opposing report and testimony. Eminent domain tracker → What a hangar owner is owed in a taking →
03

Sponsor Resets Ground Rent and the Tenants Object

Fair market rent study · Mixed box hangar and T-hangar tenancy · Federally obligated airport
Fair Market RentGround LeaseGrant Assurance 24Rate of Return

The question

A sponsor has not adjusted ground rent in a decade and proposes a step increase. Tenants argue it is arbitrary. The sponsor needs a rate it can defend, including to the FAA.

The complication

Rent set by informal comparison to a neighboring field invites challenge. A federally obligated sponsor also has to reconcile self-sustainability against the prohibition on unjustly discriminatory rates, and the record has to show how the number was derived.

The method

Two independent tests. Comparable ground lease evidence adjusted for field class, access, and utilities, and a rate of return applied to the underlying land value. Where the two diverge, the study explains why and states which controls.

Deliverable: rent study with a documented derivation, a schedule by hangar type, and a phase-in recommendation. Airport hangar rent studies → The FAA rules behind rent resets →
04

Buyer Underwrites a Hangar Portfolio Off the Seller's Rent Roll

Acquisition due diligence · Multi-field T-hangar and box hangar portfolio · Private buyer
Buy-Side DiligenceReversionPFAS ScreenLease Audit

The question

A seller markets a portfolio on trailing net operating income and a market cap rate. Applied to fee simple industrial, the math looks attractive. Does it hold once the leases are read?

The complication

Remaining ground lease terms vary field to field, and the shortest one governs the risk. Renewal options may be at sponsor discretion. Escalators may be tied to an index the buyer has not modeled. Firefighting foam history at any field can impair a later exit.

The method

Value each asset on its own remaining term with reversion modeled, not on a blended portfolio assumption. Screen every field against the PFAS and AFFF exposure register. Reconcile the rent roll to the executed leases rather than to the offering memorandum.

Deliverable: an independent investment memo written from the asset valuation perspective, with per-asset sensitivity to remaining term. PFAS exposure map → Ground-lease reversion risk →
05

Lender Sizes a Loan Against a Leasehold Hangar

Collateral valuation · Owner-occupied box hangar · Ground lease shorter than the amortization
Lender CollateralLeaseholdLoan-to-ValueSBA

The question

A borrower requests a twenty year amortization on a hangar whose ground lease runs fifteen. What collateral value supports the credit, and what happens to it over the loan term?

The complication

Collateral that reverts to a third party before the note matures behaves unlike ordinary commercial real estate. Value declines toward zero on a schedule, and a recovery analysis that assumes a fee simple sale in year twelve is not describing this asset.

The method

Value the leasehold interest with an explicit decay schedule across the loan term, paired with a note on what the sponsor's consent and assignment provisions permit a lender to do on default. Lending programs requiring a state certified appraiser are identified up front.

Deliverable: collateral opinion with a year-by-year value schedule and a written statement of the assignment and consent constraints. Underwriting a leasehold hangar loan →
06

FBO Sells and Nobody Agrees What Is Real Property

Business and real property allocation · Single-location FBO with fuel, hangar, and ramp revenue
FBO ValuationAllocationOperating AgreementEnterprise Value

The question

A single price is agreed for an FBO. Buyer and seller then have to allocate it between the operating business and the leasehold improvements, and their tax positions point in opposite directions.

The complication

Fuel margin, hangar rent, and ramp fees are not one revenue stream and do not carry the same multiple. Much of what feels like enterprise value is actually the operating agreement with the sponsor, which has a term and may not transfer on the buyer's assumed conditions.

The method

Separate the business enterprise from the underlying leasehold and value each on its own basis. Price fuel volume and margin, hangar and ramp revenue, and the remaining term and transferability of the operating agreement as distinct components.

Deliverable: supportable allocation with each component derived independently and reconciled to the transaction price. Aviation business and FBO valuation → How FBOs are valued →
07

MRO Operator Needs the Annual ESOP Update to Hold Up

ESOP annual valuation · Repair station operator, leased facility · Trustee engagement
ESOPAdequate ConsiderationAnnual UpdateRepair Station

The question

A trustee needs an annual opinion of value for plan administration that will withstand review of whether the plan paid or received adequate consideration.

The complication

A generalist valuation of a repair station tends to price it on shop revenue and margin alone. It rarely prices the certificate itself, the remaining term on the facility lease, the concentration risk in a small number of airframe or engine approvals, or the tightening mechanic labor market that is now a durable input to margin.

The method

Standard income and market approaches, with aviation-specific adjustments applied and documented: certificate standing, leasehold term, customer and approval concentration, and labor scarcity measured against the firm's Mechanic Scarcity Index.

Deliverable: an opinion of value with each aviation-specific adjustment stated and supported, suitable for annual plan administration. Aviation ESOP valuations → What makes the annual update defensible →
08

Carrier Prices a Storm-Damaged Hangar at Warehouse Replacement Cost

Insurance replacement cost dispute · Wind and hail loss to door system and roof structure
InsuranceReplacement CostDoor SystemCoverage Dispute

The question

An adjuster's estimate is built from a general commercial construction database. The owner's contractor bids substantially higher. Which figure reflects the cost to replace this building?

The complication

The door is frequently the largest single component in a hangar and has no equivalent in a warehouse database. Clear span framing, aviation fire suppression class, and slab reinforcement are likewise mispriced or omitted. Rebuilding on an active field also carries access and staging constraints that a generic estimate ignores.

The method

Component level replacement cost built from current vendor pricing for the door, shell, foundation, systems, and sitework, with a regional multiplier and airport-specific soft costs, benchmarked against the firm's published construction cost model.

Deliverable: a component replacement cost study that can be set line by line against the carrier's estimate. Hangar construction cost calculator → Depreciation of aircraft hangars →

Does one of these describe your matter?

If your situation is close to any of the eight, the approach is already mapped. Send a short note about the asset, the jurisdiction, and the deadline.

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Conflicts are checked before any engagement is accepted. Work is performed to the same standard for either side of a matter.