The San Diego Superior Court in California recently ruled that three airplane hangars purchased and occupied on leased space at San Diego Brown Field are “removable trade fixtures.” As such, the court found that the hangars are the sole property of the tenant, Finch Aerospace, which operates the California Flight Museum. Finch subleased the space for the hangars from FBO Lancair, which argued that its master lease with the city gave it control over its tenants’ hangars. Therefore, it prevented Finch from selling or moving the hangars, a situation that led to the lawsuit.
The process of buying a business jet is fraught with potential pitfalls, among them the many ways that owners can fall afoul of legal constraints. The 2014 NBAA Tax Seminar & Conference, held last month in San Francisco, offered a one-day summary of the issues facing aircraft owners, not only summarizing the key problems that can develop but also giving participants a foundation for understanding how best to set up a flight department from a legal standpoint and how to satisfy taxing authorities with the minimum hit.
Talk of production “bubbles” again colored the discourse at the March 16 to 18 International Society of Transport Aircraft Trading (ISTAT) Americas 2014 conference in San Diego, even while OEMs in attendance insisted that record backlogs fully justify their planned rate increases. Manufacturers highlighted a strong backdrop for aircraft demand fueled by aging replacement needs, a 20-seat increase in the capacity of narrowbodies since 2007, emerging-market long-term capacity requirements and the global expansion of low-cost carriers, according to a research note from Sterne Agee.
Waypoint Leasing Services placed orders with Airbus Helicopters for 12 EC225s and 25 EC145T2s yesterday at Heli-Expo. Deliveries will commence this year and continue through 2017. Financial details of the order were not disclosed. Waypoint purchased two EC225s last year that are currently leased for offshore oil and gas operations in Australia. The helicopter leasing firm has $375 million in financing from two family funds and an additional $325 million in credit from Credit Suisse, CIT Bank and SunTrust.
The rarefied deepwater oil and gas market has spawned new players and big deals in the helicopter operating leasing market, but to date these transactions have largely been confined to medium and large helicopters. What will be the impact of leasing on the industry as a whole, especially for smaller operators with light helicopters in the non-oil-and-gas segments, and will it ever become as predominant as it is for airlines, where approximately one-third of the fleet is leased?
NBAA’s board of directors elected Jim Schwertner as the organization’s newest director. Schwertner, the president and CEO of Texas-based Capitol Land & Livestock, is an ATP with rotorcraft and seaplane ratings, as well as a CitationJet type rating. His initial term on the NBAA board is for one year, and in October he is expected to stand for election for a three-year term. He will serve NBAA without compensation.
Unlike real estate lenders, most aircraft lenders don’t require title insurance, so airplane buyers rarely even know about it, let alone purchase it. That can be a big mistake.
The trustee overseeing Avantair’s involuntary bankruptcy is seeking a halt to a class-action lawsuit brought against the company on behalf of former employees alleging Fair Labor Standards Act violations for failure to pay for work performed or provide proper termination notification.
The assets of Clearwater Fla.-based Avantair will be sold and the company liquidated after it failed to meet an August 13 deadline to contest an involuntary Chapter 7 filing in the Florida Middle District U.S. Bankruptcy Court in Tampa. Judge Catherine McEwen signed an order during a hearing on August 16 authorizing the case to proceed under Chapter 7.
On Thursday, four Texas-based creditors filed an involuntary Chapter 7 (liquidation) bankruptcy filing against Avantair in Florida’s Middle District (Tampa) U.S. Bankruptcy Court. A summons was sent to Avantair on Friday and the company has until August 16 to respond. If Avantair does not respond by then, the court may allow the bankruptcy case to proceed; if it does respond, a hearing will be set and the judge will then decide if the case has merit to proceed.
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