It’s a question that aircraft owners and airport-based businesses have been asking for decades—why are there inevitably long waiting lists for hangar rental at just about every GA airport in the country?
A Case Study: Why Investment in Airports Remains a Challenge
Key Takeaways:
- General aviation airports face a severe hangar shortage, driven by significant disincentives for investors to build new facilities.
- Key obstacles include short-term land leases from airport authorities and the IRS classifying hangars on leased land as "Real Property" for tax purposes, imposing a financially unfavorable 39-year depreciation schedule.
- These factors deter crucial investor capital, leading to a stagnant supply of hangars; amending the 1988 McManus (ITC) decision to reclassify hangars as "Personal Property" for tax purposes is proposed as a solution to stimulate development.
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