HANGARS ON! Airpark storage space shrinks with business boom

HANGARS ON! Airpark storage space shrinks with business boom

By Kenneth LaFave / Photos by Kimberly Carrillo

John Meyer keeps a certain photograph as the wallpaper of his computer screen. It shows him inside a glass-walled building at Scottsdale Airport. Through the glass you see an aircraft undergoing maintenance just in front of a hangar. The photo speaks to Meyer’s role as principal and designated broker for Airport Property Specialists.

The photo also says something about the cheek-by-jowl compactness of the airport and the adjacent Airpark, the conjunction of aviation and business that makes Scottsdale Airpark the densest concentration of businesses in the state. More than 3,000 companies employ more than 50,000 people in the Airpark, which stretches roughly from Loop 101 to the north to Redfield/Thunderbird to the south, and from 64th Street to the west to 90th Street to the east. Many of the companies rely on aircraft as part of their business, which is why they have chosen proximity to one of the busiest single-runway airports in the country.

Scottsdale Airport and the wider Airpark are a picture of success, and the nation knows it. When other, similar airports look for advice, Scottsdale is where they turn.

But it’s currently the victim of that very success. Think of the problem you encounter when there’s no place to park and you’ll get the idea.

“I would say we currently have a 2 percent vacancy in our hangars, and it might even be less than that,” Meyer says.

The 2 percent availability is the result of two equal and opposite actions: the economic downturn of ‘08 with its subsequent recession, and the more recent upturn. When the downturn occurred, hangars went empty, and an empty hangar is a costly property to maintain. So to keep the revenue flowing, some of those empty hangars got leased to non-aviation customers, chief among them car collectors and car-restoration companies.

“We are living with the result of that,” Meyer observes. “It’s a simple supply-and-demand situation. Where we are today, we’re seeing greater demand than ever for hangars from aviation-related companies, but a lot of the ones we have are being occupied by non-aviation users,” Meyer says.

One answer immediately springs to mind, of course: Build more.

Not so simple.

Beth Aerts, office manager for Airport Property Specialists, traces the borders of Scottsdale Airpark on a large wall map and points to the six gates that lead from the Airport proper to taxiway stubs inside the privately owned land. Every step of the way, the map shows already developed land, one parcel after another, one occupied hangar after another. And beyond the hangars lie the businesses of the greater Airpark.

“We are landlocked,” Aerts concludes.

Requests for hangars are numerous, and for good reason. The Airpark’s reputation precedes itself.
“It’s a destination airport, one I think we’re lucky to have as a model for the rest of the country,” Aerts says. “It doesn’t use any tax dollars, and not a lot of airports can say that. Plus, the rules and regulations Scotts-dale adopted back in the 1990s have been adopted by airports around the country.”

The site originally was a training center for the Army Air Corps during World War II. After a period in which it belonged to the Church of Seventh Day Adventists, who used it in connection with a pilot program for its missionaries, the City of Scottsdale obtained it in the 1960s. The 1980s saw its period of greatest growth, and the innovation of the “through-the-fence” idea of private taxiway access to the runway. At the time, this was a new and bold plan, and it has since been adopted by many other airports around the country.

The city grew and the Airpark grew with it until both arrived at the current boom, with its rewards and its challenges.

“We’re scrambling to find good hangar space,” Meyer admits. “We had a major company come to us with a super-mid-sized jet as part of their business. We had to find a home for their jet. In that case, we were able to satisfy their need. They bought a hangar at $305 per square foot, and moved their company headquarters to Scottsdale Road.”

On the other hand, “We had two companies inform us recently to say we’re coming to town,” Meyer says. “They asked ‘Can you find a place for our airplane?’ At one time it would have been a no-brainer because of the many vacancies. There was plenty of space. Now the problem is not only finding a hangar, but finding the proper hangar for the size of their airplane.”

That search is ongoing, but in at least one recent case, it was not possible to find an appropriate hangar for a business that sought to relocate here.

Help, of a sort, is on the way. The massive renovations announced by Scottsdale Airport for completion in the summer of 2018 will include two executive hangars, with the capacity for larger aircraft. The old terminal will be knocked down later this summer to begin the process.

And while it is scarce, some vacant land is available within workable distance. Not all the owners of that land wish to sell, however.

“There’s space, though not a lot,” Meyer says. “And we are starting to see new construction, which is encouraging. Someone is building a new, 10,000-square-foot hangar set to be completed by the end of the year. We’ll have tenants before the building is completed. Other people are looking to build but haven’t pulled the trigger yet.”

Inflation doesn’t help. Wresting land from owners who see it as an investment is difficult when land values have soared in recent months. Difficult – but not impossible. Between new construction, purchase of available land, the terminal renovation/buildout and gently pushing to get car collectors to find different storage, there is hope.

“The situation is starting to correct itself,” Meyer says. “But it’s slow.”