Scarce Hangar Space Spurs Arizona Development

Nearly three dozen general aviation hangars are planned at Volare Hangars at Pegasus Airpark near Phoenix.

Rendering of the Volare Estates project at Pegasus Airpark (5AZ3). [Courtesy: Volare Estates]

A new hangar development in Queen Creek, Arizona, is the direct result of personal experience with the lack of hangar availability in the Greater Phoenix area. 

John Panfil, the CEO of Equity 1000 LLC, a performance-based private equity firm, and developer of Volare Estates at Pegasus Airpark (5AZ3), elaborated on the project’s origins. 

“We were looking for hangars and happen to live eight minutes from Pegasus Airpark,” Panfil said. “We called about an ad for a small 1,400-square-foot box hangar there, and it was already in escrow. But the conversation led to finding out about the airpark's original plans for additional hangars on the adjacent vacant 7 acres of land there that nobody had developed for a long time once they were converted to custom home lots after the last economic recession.

“After purchasing the land, we had to rezone the properties back to their original use of hangars. We received our zoning approval in October 2022 and are on the tail end of receiving our building permits to start construction and started our journey over a year and a half ago.”

Although Panfil had only recently shifted his decades of commercial real estate expertise to general aviation, he said he has always been an aviation fan tracking market trends and new technology waiting for the right opportunity to break into this niche market. 

“Pre-pandemic, we had it on our radar screen to get into aviation real estate, and after COVID, everything accelerated,” Panfil said. “We shifted almost entirely to aviation real estate, particularly focusing on hangars in high-density areas. We don’t want to get into building homes, but we are looking at a couple of airports where buyers may be able to build their own attached/detached home or similar to Pegasus where 10 of our units can have living quarters built out inside the hangar. 

Rendering of the Volare Estates project at Pegasus Airpark (5AZ3). [Courtesy: Volare Estates]

“When we started looking around for hangars, we learned that if you find something at a municipal airport, you are only buying a ground lease and usually have strict restrictions against storing other items in addition to the aircraft. We weren’t fans of this, especially coming from the real estate background, but even these hangars have extremely limited availability, including to rent. Chandler (KCHD), Deer Valley (KDVT), and just about any other airport near density has a waiting list 10 years long or more. This really sparked our interest in moving forward.

“I’ve been an aviation fan since I was a kid, and so I followed the industry on and off for many years. I try to understand the market from a macro level. In a congressional hearing last year, the [Aircraft Owners and Pilots Association], the [National Business Aviation Association], and others were all doing a state of the union, and the fifth item on the list, from a national standpoint, was the hangar shortage. So that also helped solidify the direction we were exploring.”

Panfil, along with his son and partner, Johnnie, undertook the Volare Estates at Pegasus project in late 2021. The project bears an aviation-inspired homage to their family’s roots.  

“Volare means ‘to fly’ in Italian,” John Panfil said. “My mother came from Italy when she was 14 years old, so we’re keeping those beautiful memories alive using the name. She would keep Dean Martin on her phone and when someone would call, Volare would come up. And the Volare Estates model is to ‘Live, Work, and Fly.’”

The Volare Estates development at Pegasus Airpark boasts 34 hangars, split between two phases. There are three types of hangars available: 60-foot by 60-foot (eight in each phase), 80 by 60 (four in each phase), and “executive” 80 by 80 (five in each phase). In addition to their larger footprint, a distinguishing feature of the 6,400-square-foot executive hangars is that each boasts its own street address with separate driveway entrances, as well as an RV garage door, front door, and large front yard/patio with sliding glass doors. 

Additional information regarding the project’s specificities, including site plans, pricing, market comps, and other elements are contained within a buyers information package. This 19-page document is available upon request, and one of the project’s key differentiators is explained within. This element, according to Panfil, is an attractive standout for buyers  interested in owning real property.

“(There are) no ground leases at a private airpark, and (Pegasus Airpark) has some of the best pricing available to owners on all types of aviation fuel,” he said. “Queen Creek has been named one of ‘America's Friendliest Cities’ by Forbes magazine, and (has earned) lots of other regional and national awards, such as No. 1 on the ‘Best City To Raise a Family in 2022’ by Dwellics.”

Panfil also elaborated on Equity 1000’s philosophy and business model.

“We’re a small family-owned equity firm, and I come from the construction, real estate development world,” he said. “We spend quite an effort in maintaining relationships with equity firms, family offices, and high-net-worth individuals. Our business model is to identify, strategize, and implement as a macro developer for investment opportunities in real estate.” 

These partnerships have not only enabled the firm to be successful in this development, but they’ve also lessened the burden of financing for buyers on an asset type many lenders are wary of. 

Site plan of the Volare Estates project. [Courtesy: Volare Estates]

“Boomerang Capital Partners LLC, is a $250 million company located in Mesa that provides equity and debt financing for commercial and residential real estate,” Panfil said. “Equity 1000 has enjoyed working with Boomerang for the last five years on commercial projects, and both companies are excited for the future of aviation-based real estate. Additionally, Trust Bank is providing our construction loan and also extending 50 percent LTV financing to qualified hangar buyers. Many pilots have experienced the lack of lenders willing to finance hangars, (and the LTV) provides our buyers with a rare opportunity to use long-term financing for the purchase of our hangars.”

As Panfil expected, reception to the project thus far has been very positive. This has equated to a sizable reservation list and deposits from those whose hangars broke ground in early May 2023. 

“Zoning for something like this is quite a task, as you could imagine,” he said. “We’ve gotten everything zoned and now are at the point of finishing up permits with the town and engineers. Our goal is to deliver units as early as the last quarter of 2023.”

We have two phases of development. In phase one, we have 17 hangars, and in phase two we have a mirror image of 17 hangars. We have not opened up phase two for reservations yet and are waiting to finalize our construction cost, schedule, and purchase contracts.

“In our first phase, we only have one hangar available, and the rest are reserved—with fully refundable $25,000 deposits. We haven’t done much marketing and only started public advertising in December 2022 with a few ads. Prior to advertisement, we probably had eight units reserved almost instantly from word of mouth. We have over a hundred folks on our prospect list that have reached out with interest, and many are waiting for us to open phase two or provide purchase agreements.” 

The pair is careful in planning their trajectory, both with the current project as well as with how they see the firm’s future. For example, Panfil expects outlying areas will become more accessible and attractive to buyers as technology and transportation avenues continue to improve. 

“What we’ve learned from our current project is that you can certainly find airports, both private and public, that have hangars,” he said. “But they are not in the best locations currently. So, we are also looking at places that are rural, where we are considering developing, that will be much lower cost. We are right now in talks and exploring early-stage development opportunities at about nine private and municipal airports. We look at those opportunities and recognize the need for lower cost hangars in the ‘Live, Work, and Fly’ environment. An hour drive by car should be a sweet spot for folks in the entry-level general aviation world to hangar a plane.”

Grant Boyd is a private pilot with eight years of experience in aviation business, including marketing, writing, customer service, and sales. Boyd holds a Bachelor's and a Master's of Business Administration degree, both from Wichita State University, and a Doctor of Education degree from Oklahoma State University. He was chosen as a NBAA Business Aviation "Top 40 Under 40" award recipient in 2020.

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