AIRPORT MARKET ANALYSIS

Transcription

1 STATESVILLE REGIONAL CITY OF STATESVILLE, NC November 2016

2 ACKNOWLEDGEMENTS Costi Kutteh Mayor of Statesville Statesville Council Members William P. Morgan, Jr. - At Large Michael Schlesinger - At Large Roy West - Ward One C.O. Jap Johnson - Ward Two Jarrod Phifer - Ward Three Michael Johnson - Ward Four Arnold W. Watt - Ward Five Keith Williams - Ward Six Larry Pressley City Manager John M. Ferguson Airport Manager David Currier Director of Planning Russ Rogerson Executive Director Economic Development Statesville Airport Commission Stephen Johnson - Chairman L.A. Parks Vice Chairman Todd Bodell David Alexander Wilson Jay Brown Mike Colyer C.O. Jap Johnson - Council Liaison ACKNOWLEDGEMENT The Statesville Regional Airport Market Analysis Study was wholly funded through a contract with the City of Statesville, in close coordination with elected City Council personnel, appointed City officials and airport management staff. The City contracted with the firm Parrish & Partners of North Carolina, PLLC to lead the Study process, and to prepare this summary brochure. No Federal Aviation Administration (FAA) or North Carolina Department of Transportation (NCDOT) funds or grants were utilized as a part of this effort. The contents of the Study and this summary brochure have been approved by the City of Statesville and its elected City Council.

3 INTRODUCTION In 2015, the City of Statesville contracted to prepare a Strategic Market Analysis for the Statesville Regional Airport (SVH). The effort was driven by a vision and stated goals established by elected officials, key City staff and community leaders. Recognizing that the Airport is well positioned to capitalize on its exposure as a prime corporate general aviation airport in the Charlotte Metropolitan area with top-notch infrastructure in place, the key objective of the study is to assess and evaluate the attractiveness of the Airport offerings along with the long-term vitality of the surrounding marketplace to determine key target markets and tenants for the Airport which would drive its future success. Ultimately, these findings, conclusions, and recommendations that resulted from the study serve as decision tools for the City to focus on business growth at and around the Airport. Analyses of the current and anticipated environment in and around the City of Statesville, the Airport itself, and the Charlotte Metropolitan area, ultimately determine the growth potential at the Airport and which market sectors may afford the best return on investment for the City and its airport tenants. The recommendations collectively serve as a framework for optimized Airport operations and focused marketing. The findings and recommendations were also supported through a methodical comparative analysis with peer airports throughout the region. Not unlike the vast majority of other general aviation airports throughout the U.S. that operate on a non-profit basis, Statesville Regional Airport relies heavily on revenues from operational fees (leasing, fuel flowage, and other handling activities), and is supported by state and federal grants in aid. Diversifying the mix of tenants and activities at the Airport will function to enhance Airport operating revenues, to elevate economic impacts (increased employment and taxes), and to afford the City/County citizens with improved access to the national airspace system, translating to dramatically improved global travel and commerce. All indications point to strong growth potential for the Statesville Regional Airport and its surrounding areas. Population, per capita income and overall new business growth are projected to exceed North Carolina and U.S. averages in the coming 20 years. The proximity and overall influence of the greater Charlotte metropolitan region is and will continue to be a key driver. All of these items bolster the attractiveness of Iredell County and more specifically the City of Statesville. From an aeronautical perspective, the Airport s combination of top-notch facilities and the availability of nearby large, rural tracts with excellent interstate access, will serve as an attractant to a diverse mix of corporate tenants of all sizes. Given these tangible strengths and the many opportunities that lie ahead for the County, City and Airport, the following overview of recommendations provides key target areas to ensure positive growth objectives are achieved.

4 HISTORY In 1935, the Statesville Airport opened as a small facility, privately owned by John White Moore and Fred Slane. In 1942, the City of Statesville purchased the heart of the airport and graded two crosswind runways, 3,500 feet long and 2,700 feet long. In 1949, the Civil Aeronautics Administration, now the Federal Aviation Administration, approved the Statesville Airport to enter the federal airport program. During the 1950s, the local community put together a cooperative funding effort with the City of Statesville to develop the Airport and the two runways were paved. Statesville Airport got its first taste of corporate activity in 1978 with Clark Equipment Company. The City extended Runway to 4,800 feet so the company s corporate jets could operate from the Airport. In the fall of 1978, Statesville Flying Service opened its doors as the airport s fixed base operator (FBO). By the end of the 1980s, the City completed construction of a terminal, ramp area, and full length parallel taxiway. Runway was extended to 5,000 feet. Working with the City, Statesville Flying Service constructed 20,000 square feet of hangar space, relocated a 5,000 square foot maintenance hangar, and outfitted and furnished the terminal building. Mirroring the national economic boom in the 1990s, Statesville s highly skilled workforce grew throughout the 1990s and the area experienced low unemployment rates. Soon the racing industry, specifically NASCAR, contributed millions to the economy surrounding Charlotte including Statesville. Corporate hangars were built at Statesville for NASCAR drivers including Michael Waltrip and Dale Earnhardt. The next wave of expansion saw navigational improvements and a taxiway extension, which allowed greater accessibility in poor weather conditions. Shortly thereafter, Statesville Flying Service built a 10,000 square foot hangar to address the demand of users wanting storage space for aircraft. Headquartered 20 miles south of Statesville in Iredell County, Lowe s, the second largest home improvement company in the U.S., announced in the early 2000 s it would develop its corporate aviation department at the Statesville Airport, relocating from Wilkesboro. In the early 2000s, the City of Statesville approved the closure of the north/south runway for corporate hangar development and committed to lengthening the runway, improving navigational aids, and providing tax incentives to potential corporate (i.e., Lowe s and others) users and tenants. Significant activities that coincided with the City s expansion projects included the investment of an additional 12,000 square-foot hangar by Statesville Flying Service, the arrival of several corporate tenants, and a strengthening local economy. In 2004, the airport changed its name from Statesville Municipal Airport to Statesville Regional Airport and with more than $14 million in airport improvements being completed in 2007, Statesville Regional Airport entered a new and exciting time. Airport improvement projects completed included lengthening Runway to 7,005 feet, extending the parallel taxiway, installing an instrument landing system, and building 54,000 square feet of hangar space, 230,000 square feet of ramp space, 6,000 square feet of office space, and a 148 space parking lot. At the end of 2007, Newell Rubbermaid Inc., a Fortune 500 Atlanta based company, announced it would be moving its aviation operations and three of its aircraft to the Airport in Statesville Flying Service developed a 24,000 square foot corporate hangar area for Newell Rubbermaid s $3 million corporate flight operations center and signed a 10 year lease with the company.

5 ASSETS 7,003 X 100 Foot Asphalt Runway Pavement Strength To Support Larger Corporate Jets Instrument Landing System W/Approach Lighting System General Aviation Terminal Building (4,000 Sf+) Ample Based And Transient Tie-Down Apron Full Service FBO Operations No Airspace Restrictions From Charlotte Douglas International Airports No Curfew On Flight Operations Highly Competitive Avgas & Jet-A Fuel Pricing Automated Weather Observation Station Nearly 90,000 Sf Of Conventional Hangar Space Very Competitively Priced Hangar And Apron Storage Space Significant Acreage On/Near Airport That Is Zoned Commercial/ Industrial

6 REGIONAL CHARACTERISTICS HISTORICAL AND FORECAST DATA Fortunate for SVH, the turbine fleet growth is a bright spot on the horizon for general aviation. Given national trends, forecasts were developed spanning 20-years, which took into account local and regional trends for socioeconomic indicators, including: population, employment, retail sales, and Per Capita Personal Income (PCPI). A service area was defined, based on a 30-minute drive time from SVH, which included 14 counties: Alexander, Burke, Cabarrus, Caldwell, Catawba, Davidson, Davie, Gaston, Iredell, Lincoln, Mecklenburg, Rowan, Wilkes, & Yadkin. Socioeconomic data produced regional historical and projected estimates for the entire service area. CORPORATE AIRCRAFT REGISTRATION BY COUNTY As a comparison to determine the attractiveness of the Total Corporate Aircounties in the service area, Aircraft craft RegistraCounty Airport research of the FAA Aircraft Registrations Registration Database was tions (% of Total) performed. The databased Iredell Statesville Regional Airport % categorizes aircraft registrations MecklenCharlotte-Douglas International Airport % based on type of ownership, burg which falls into one of five main Forsyth Smith-Reynolds Airport % categories: individual, co-owned, Union Charlotte-Monroe Executive Airport % partnership, corporation, and Cabarrus Concord Regional Airport % government. A summary is Catawba Hickory Regional Airport % presented, by County, of all Lincoln Lincolnton-Lincoln County Regional Airport % aircraft registrations and the York Rock Hill/York County-Bryant Field % resulting percentage of aircraft Rowan Rowan County Airport % owned and registered by corporations. Interestingly, Iredell County is in the top 3, from a percentage standpoint, comparing favorably with Mecklenburg County and Union County. This strongly suggests the attractiveness of the County and the Statesville Regional Airport to corporate aircraft owners, regardless of size. AIRCRAFT PERSONAL PROPERTY TAX, BY COUNTY *Tax Rate (per $100) Annual Property Tax ($1M Sample Aircraft Value) County Airport York Union Mecklenburg Rock Hill Airport - Bryant Field Charlotte-Monroe Executive Airport Charlotte-Douglas International Airport $15, $13, $12, Forsyth Smith-Reynolds Airport $12, Catawba Hickory Regional Airport $12, Cabarrus Concord Regional Airport $11, Lincoln Lincolnton-Lincoln County Airport $11, Iredell Statesville Regional Airport $9, Rowan Rowan County Airport $7, *County and City tax rate combined Oftentimes many factors influence decisions on where to register an aircraft, including where a person or corporation resides, proximity of nearby aviation facilities to base aircraft, availability of tie-down or hangar space, personal property/aircraft taxation rates, overall business environment, etc. A summary analysis of taxation rates for personal property by County is presented, assuming most aircraft residing at an airport are most likely registered in that same jurisdiction. This presents the county tax rate per $100 of assessed value, along with a sample annual rate paid for $1 million aircraft.

7 REGIONAL CHARACTERISTICS From an economic development perspective, localized county growth is critical. A focused analysis was performed for the Charlotte metropolitan area. Data was evaluated with and without Charlotte/Mecklenburg to determine levels of impact by the City of Charlotte versus the outlying counties and their individual growth levels. The impact of Charlotte/Mecklenburg was significant and overshadowed the outlying counties. When considering the outlying counties, Iredell County is projected to perform well versus the other counties. Iredell County remains the third fastest growing county. In a positive trend, Iredell County is projected to move from third to second behind Cabarrus County in retail sales. PER CAPITAL PERSONAL INCOME In the areas of PCPI and Gross Regional Product (GRP) Iredell County demonstrates extremely strong, positive growth in coming years. More importantly, Iredell County s already strong GRP component is projected to climb at the fastest rate, pushing them into a leadership role within 5-10 years. These are all excellent indicators for the economic growth of Iredell County, and points to a bright, robust environment for new business and existing business growth. These factors all should work to support a healthy aviation market at SVH and continued interest in aeronautical and non-aeronautical development on and near the Airport. GROSS REGIONAL PRODUCT In Dollars (w/o Charlotte/Mecklenburg Co.) (w/o Charlotte/Mecklenburg Co.) Approximately 50% of the U.S. population lives INDUSTRIAL OVERALL ASKING RENT AND OVERALL VACANCY within a day s drive of Charlotte, making Charlotte Area industrial space desirable to large distributors. Recent record market activity has vacancy poised to hit a record low. Space availability is allowing landlords more leverage, pushing lease rates to a record high, especially for those with Class A warehouse availabilities and modern facilities with in-demand amenities (i.e., 30-foot clear heights). Rates are expected to rise in the next two years, further demonstrating the impact that supply and demand is having on industrial space. Barring any future recessionary periods or incidents of uncertain national or global economic downturn, the Charlotte metropolitan area should continue to see steady and often strong growth in the commercial and industrial sectors.

8 TENANTS Carolina BalloonFest Champion Air, LLC Checkered Flag Aviation G. L. Wilson Building Company GB Aviation Leasing, LLC IOMAX Iredell Composite Squadron/Civil Air Patrol JRM Air, LLC Lowe s Companies, Inc. Statesville Flying Service, Inc. Sun Solar1 Victory Air, LLC

9 TOP LOCAL/REGIONAL EMPLOYERS Iredell/Statesville Schools Davis Regional Medical Center Iredell Memorial Hospital Doosan Infracore-Portable Power Iredell County Government Engineered Sintered Components Lowe s Regional Distribution Center Kewaunee Scientific Piedmont HealthCare City of Statesville J.C. P. Logistics (Distribution) Walmart ASMO of NC, Inc. Manheim Statesville Pratt Industries Elmer s Products Thor-Lo, Inc. Mack Molding Goodyear Tire & Rubber Homestar North America

10 DEVELOPMENT The Airport Layout Plan (ALP) drawing depicts existing facilities and future improvements recommended for the Airport over the ensuing 20-year horizon, and beyond. Improvements include: a new south parallel taxiway, Runway Safety Area and obstruction clearing, future landside development including hangars, and various ramp associated with based or transient tie-downs. The success of the development in the vicinity of the Airport requires vision, bold moves, and dedicated leadership. Development strategies need to balance the desire for short-term economic growth with the longterm role that the Airport plays in the City and the larger County. The study area is one of the most promising expanses of underdeveloped land north of the Charlotte metropolitan area. Already the northern arc of the Charlotte metropolitan area is being recognized nationally as outpacing the vast majority of other urban areas. The exhibit provides a summary of largely open areas with limited restrictions on development, while having excellent access to the major roadway network. Many of these large tracts are suitable for full scale business parks combined with mixed use development. Ideally, these areas may be integrated together to form a cohesive plan. The north area of the airport may easily serve commercial/light industrial business park development. Adjacent to nearby residential areas are possibly best suited to true mixed use development, merging uses of residential, retail, commercial and office spaces. Sites to the south, given their proximity to rail, could serve as a link to air and truck transportation, providing a means for moving imported goods throughout western and central North Carolina and beyond.

11 WHY CHOOSE STATESVILLE? The Airport environment has an opportunity to focus marketing efforts on unique segments of corporate America that look to the synergies afforded by being immediately adjacent to an efficient airport for logistics reasons, whether it is to transport upper management and executives, or to ship/receive just-in-time cargo essential to their business operations. These aeronautical and nonaeronautical businesses include: Logistics warehousing Computer/IT systems and parts Healthcare and biomedical support Aircraft manufacturing Specialized air cargo operators New technology energy research and production Specialized automobile, trucking and watercraft parts Small to mid-size corporate businesses (1-3 turbine aircraft) Specialty and Maintenance/Repair/Overhaul (MRO) businesses Large corporate flight departments (Lowe s, Champion Air, etc.) Commercial charter/commuter companies and low cost airlines (long-term)

12 prepared by: published November 2016