Airport Master Plan 2012 - City of Waterville

4) Lease for Cargo Operation. A lease agreement
between the Airport and Wiggins Airways does not
currently exist. The Airport should execute a lease
agreement with Wiggins Airways at market rates
for the existing cargo operation at the Airport.
Among other benefits, having a lease agreement in
place protects both parties:
1. The agreement provides a guarantee of
revenue for the Airport over a defined time
period; and
2. Provides the cargo operator a guarantee that space will be available for their operation.
5) Business Development and Land Leases. With an FBO providing the day-to-day aircraft services, it
is recommended that airport management focus their efforts on the development and redevelopment
of Airport land parcels. Either through an RFP process or unsolicited proposals, it is recommended
that the Airport work with local and state economic development officials to review and consider
airport related development proposals. Also, since development and redevelopment activity on the
Airport is a basis for increasing revenue, when land or building leases are ultimately developed or
renewed, it is recommended that an appraisal by a qualified airport appraiser be performed to
determine fair market rates.
As an example, if the Airport were to ground lease additional parcels for box hangar development,
they could see an increase in annual revenue. The ground lease of one box hangar identified on the
ALP would net approximately $2,118 per year which suggests at full build out of 8, would net
approximately $17,000 in annual revenue. This is based on 1,765 Sq. Ft of land per unit and a
monthly ground lease rate of $.10 per Sq. Ft.
Two additional examples can be seen from the t-hangar and corporate development areas.
1. The ALP identifies an area to develop t-hangar complexes. Assuming private development of
the t-hangars, each unit would generate a land lease of the approximate 9,450 square feet of
land. At the $0.10 per square foot rate, the Airport could generate up to $11,340 in annual
revenue per unit ($34,020 if all three areas are developed).
2. The ALP identifies an area for corporate development. This area is approximately 59,395
square feet. For this analysis and to be conservative with the estimate, it is assumed half of
this space may initially be leaseable at 30,000 square feet. At the $0.10 rate, this parcel could
generate up to $36,000 annually for the Airport.
6) Control Maintenance and Operational Expenses. Controlling maintenance and operational
expenses is a day-to-day business practice of any successful operation. Since staffing, utilities, and
maintenance expenses can vary in the northeast due to weather extremes, it is recommended that the
Airport monitor expenses and develop reserves for any unforeseen expenses or significant escalations
in airport utility and maintenance costs.
7) Equipment Costs. It is likely that unanticipated costs related to equipment maintenance could
adversely affect the airport financials for any given year. Since equipment maintenance costs are
largely related to the age and quantity of existing airport related equipment, it is recommended that an
The City of Waterville Maine
Implementation and Financial Plan – Page 8-19
Airport Solutions Group, LLC & The Louis Berger Group, Inc. December 2011