FBO (Mercury Air) doubling hanger rent to run off GA at BHM.......is this legal?

"Dave S" wrote in message
...
| This may be a VERY unpopular opinion, but if you take the business and
| economy point of view.. if you have a waiting list, you arent charging
| enough. Plain and simple. Supply versus demand.
|

Not that unpopular. I look at these airfields with 10 year waiting lists for
hangars, and I can't help but think that the rent is way too low. But what
do I know? I only have twenty years of experience developing, building,
syndicating, owning and managing commercial and multi-family residential
real estate. Frankly, the way most airports are managed, they deserve to
fall prey to developers. The way some aviation people talk, you would think
that they were socialists who believe that airports are an entitlement
required to subsidize the poor.

If airports were managed properly, they would charge market rent for hangars
and other space. They would be profitable, and more hangars and office space
would be built, lowering prices over all until an equilibrium was reached.

In article , "C J Campbell"
wrote:

If airports were managed properly, they would charge market rent for
hangars
and other space.

how is market rent set for a product/service whose supply is restricted?


They would be profitable

why is profitability assured?


, and more hangars and office
space
would be built,

I'd love to see you try to survive a meeting where you propose
this to the anti-airport NIMBY goons around KBED.

lowering prices over all until an equilibrium was
reached.

lower prices? really?

--
Bob Noel

By regulation. The question is, is hangar supply at a particular airport
more like a municipal utility (water, garbage collection) or more like a
free market commodity?

"Bob Noel" wrote in message
...
In article , "C J Campbell"
wrote:

If airports were managed properly, they would charge market rent for
hangars
and other space.

how is market rent set for a product/service whose supply is restricted?


They would be profitable

why is profitability assured?


, and more hangars and office
space
would be built,

I'd love to see you try to survive a meeting where you propose
this to the anti-airport NIMBY goons around KBED.

lowering prices over all until an equilibrium was
reached.

lower prices? really?

--
Bob Noel

Neither. A free market commodity would permit others to build hangars so that
it was not a monopoly. A municipal utility would not be restricted in its
availability, and the users have at least indirect control of the rates
through their local government. The problem with hangars, at least in this
neck of the woods, is that the supply is artificially restricted to the point
that there are decade long waiting lists for hangars with exorbitant rents.
The only alternative is tying down outside, which with New England winters is
very tough on airplanes.


Dan Thompson wrote:

By regulation. The question is, is hangar supply at a particular airport
more like a municipal utility (water, garbage collection) or more like a
free market commodity?

--
--Ray Andraka, P.E.
President, the Andraka Consulting Group, Inc.
401/884-7930 Fax 401/884-7950
email
http://www.andraka.com

"They that give up essential liberty to obtain a little
temporary safety deserve neither liberty nor safety."
-Benjamin Franklin, 1759

"Dan Thompson" wrote in message
. ..
By regulation. The question is, is hangar supply at a particular airport
more like a municipal utility (water, garbage collection) or more like a
free market commodity?


As part of the transportation infrastructure it is different from either,
although I would think closer to a municipal utility.

The government doesn't know how to deal with Amtrak, either.

Hanger supply is exactly like real estate supply.

Mike
MU-2


"Dan Thompson" wrote in message
. ..
By regulation. The question is, is hangar supply at a particular airport
more like a municipal utility (water, garbage collection) or more like a
free market commodity?

"Bob Noel" wrote in message
...
In article , "C J Campbell"
wrote:

If airports were managed properly, they would charge market rent for
hangars
and other space.

how is market rent set for a product/service whose supply is restricted?


They would be profitable

why is profitability assured?


, and more hangars and office
space
would be built,

I'd love to see you try to survive a meeting where you propose
this to the anti-airport NIMBY goons around KBED.

lowering prices over all until an equilibrium was
reached.

lower prices? really?

--
Bob Noel

In article , "Mike Rapoport"
wrote:

Hanger supply is exactly like real estate supply.

no it isn't.

--
Bob Noel

"Bob Noel" wrote in message
...
In article , "Mike Rapoport"
wrote:

Hanger supply is exactly like real estate supply.

no it isn't.

Why not?

"C J Campbell" :
Not that unpopular. I look at these airfields with 10 year waiting lists
for
hangars, and I can't help but think that the rent is way too low.

It certainly is. If the renter could double his rates and still fill the
hangars, he should do so. However, where the supply is restricted by a local
government, a monopoly or a connivance of the two, free market rules don't
apply. Even though there are people willing to pay the high prices, those
prices are artificially high if the supply is artificially low.

Frankly, the way most airports are managed, they deserve to
fall prey to developers.

Indeed. In the case of my Airport, the FBO doesn't give a rap about the
light GA customers. It (the FBO) doesn't even bother to kill the weeds
growing through the cracks in the GA ramps, let alone sweep the ramps or
paint the hangars and shelters. Its strategy is to raise rents steadily
until a shelter or hangar stays vacant, and hold there a while, meanwhile
making zero investment in the enterprise. Because the FBO is a monopoly,
aircraft owners can like it or lump it.

This is the kind of lazy management that a monopoly can get away with. It is
short sighted and foolish, since it discourages people from owning and
operating aircraft at the field, endangering the very existence of the
airport.

If airports were managed properly, they would charge market rent for
hangars
and other space. They would be profitable, and more hangars and office
space
would be built, lowering prices over all until an equilibrium was reached.

True. And if frogs had wings, no doubt other amazing things would happen.
--
Dan
C172RG at BFM