For years, pilots across the country have felt the strain of limited hangar availability. Recently, that strain has increased in breadth and severity, leaving many asking the same questions—why has the supply of hangar space not kept up with demand?
A survey conducted by the Aircraft Owners and Pilots Association (AOPA) Airport Support Network found that 71% of general aviation airports are experiencing a shortage of individual general aviation hangars. At the same time, 55% of airport managers surveyed report having land available to develop them, but they lack the funding to do so.
“I can’t tell you with any statistical data how long it’s been going on but ask any pilot if there’s been a hangar shortage and he’ll say yes. How long? He’ll say as long as I’ve been flying,” says Mike Ginter, AOPA vice president of airports and state advocacy. “It’s worse now, but I would tell you that I’m aware of a hangar shortage because there’s been waiting lists at airports for as long as I can remember, and I’ve been flying for almost four and a half decades.”
General aviation airports are feeling the pressure. According to the AOPA, hangars are responsible for approximately 45% of an airport’s gross revenue, which makes the shortage an ongoing concern in terms of financial sustainability.
For airports, the answer is not always as simple as building more hangars. A combination of several factors, such as inflation, labor shortages, demand and pandemic-related economic stressors has steadily increased the cost of construction.
The aviation industry has especially felt the sharp rise in construction costs, as Curt Castagna, president and CEO of the National Air Transportation Association (NATA) explains.
“The cost of new hangar development today is more than double what it was 20 years ago, and during the pandemic, we were watching construction costs rise 3% or more monthly almost, or quarterly,” Castagna says.
Besides the need for additional hangars, many existing ones also need to be replaced.
“Airports provide leases to FBOs or developers or businesses that are building hangars, and they give them a term commensurate with the investment that’s being made, and that could be 20, 30, 40 years,” Castagna says.
The last surge of development in the U.S. was during the 1980s and 1990s, with many of those leases now coming up for termination. In addition, many of the hangars built before the 1980s have now served their functional lives, he says.
For small, GA airports, covering the cost to replace or add units can prove to be difficult.
“Regardless of the cost, the available funding has never been there to fund GA hangars,” Ginter says. “Now, to be fair, the Airport Improvement Program (AIP) funding does allow hangars to be built. [But] every airport manager we’ve talked to said it’s impossible to get higher funding.”
Low-Priority Funding
The FAA’s Airport Improvement Program (AIP) provides grants to public and private entities seeking to increase the development of public-use airports included in the National Plan of Integrated Airport Systems (NPIAS).
For smaller GA airports, the AIP generally covers at least 90% of development costs—the rest of which is typically split between the airport sponsor and the local and/or state government.
While a handful of airports have received the FAA’s AIP funding, the number remains extremely low, Ginter says.
“Since the amount of airport grant money requested is always greater than what the FAA has available, the FAA sets priorities by project type,” he says. “They decided hangars are a very low priority. In fact, according to the latest FAA order 5090.5 “Formulation of the NPIAS and ACIP” dated Sept. 3, 2019, hangars ranked 31 out of 32 eligible airport funding projects. This is why a federal funding stream is so important to improve the financial self-sustainability of community airports.”
With funding difficult to obtain, airports are left to their own devices to be innovative, Ginter says.
According to Ginter, those innovative options could include USDA Rural Development Loans or similar grants designed for local development.
At the same time, a little help may be coming.
The U.S. House of Representatives recently passed the Securing Growth and Robust Leadership in American Aviation Act, otherwise known as the FAA Reauthorization Bill, which included an increase in funding for airport infrastructure—and prioritizing funds for smaller GA airports, which could help offset some of the scarcity of available hangars.
“Typically, the reauthorization bill has included sections, little, tiny snippets that include things that improve GA, whether it’s funding or workforce development or whatever. This one has an entire section that you just call the GA title, so that’s incredible,” Ginter says.
AIP funds would also be increased, per the House’s version of the bill.
“It’s not a giant sledgehammer fix; it’s a scalpel fix,” Ginter says. “If the numbers work out the way we’ve calculated them, it might mean 20 or 22 airports might be able to get an 11-unit T-hangar complex at 5% or 10% of the total cost. The funding will be a game changer for small community airports that are federally funded. It’ll be eligible at the federally funded eligible airports.”
Until governmental assistance becomes more of a reality, the efforts can often only move at the speed of Congress. Until then, there are still opportunities for individuals across the industry to help alleviate the shortage.
“We believe that while the public sector, through AIP, grants and other programs, can provide funding to airports,” says Castagna, “there’s opportunity with the private sector to come into an airport, invest private money in exchange for a ground lease, and do a development build—whether it be an FBO or just a hangar facility or a small general aviation terminal and self-service facility. Private equity is interested in helping airports in exchange for ground leases and those ground leases provide the term to amortize the investment.”
Ginter echoed the support for federal funding access for private entities.
“We believe that the private sector developers should have the same access to those funds that the public airport sponsors do,” he says.
At the individual level, Castagna suggests that aviators could jointly invest in available airport land to build new hangars at their local GA airport, but should ask themselves the following questions:
“Are they [local residents] supportive of the airport or is there anti-airport sentiment in that community?” Castagna says. “Does the airport have a business strategy where they’re providing development, where they’re bringing infrastructure, electrical, sewer and water up to the land, to the airport, so that development connections can be made? Is the rental rate around the airport healthy, where it’s been kept up to market so that when I’m finished doing new development, I’m not competing with existing airport facilities?”
“These are all some of the variables that a developer should look at as they’re talking with their airport to study it, and we encourage airports to study it, because, if you just go build some hangars and the market’s not healthy or sustainable, then you’re going to have empty hangars and bankrupt facilities. And that just doesn’t work either,” Castagna says.
While the shortage has remained a consistent force for several years, Ginter believes there is still much to be learned about the scope of the situation.
Waitlists
“About three years ago, as the VP of airports for AOPA, I started looking around the industry for the literature,” Ginter says. “Where’s the data? Who’s looked at this? And I could find nothing. There’s nothing on the other alphabet websites. There’s nothing in the FAA’s archives. Nothing in the ACRP literature that talks about the hangar shortage. The hangar shortage is an evolving, deepening knowledge base. So, we’re going to continue quantifying the problem.”
When considering years-long waiting lists, Ginter offers the following advice to airport managers to help ease waitlist woes.
“If you have a hangar waiting list, please validate it. Check it out,” he says. “Call everybody on the list, make sure it’s current. See how interested the next person is to get a hangar and make sure that when a hangar does become available, you know you have a good list. The second thing we tell our airport managers is if you have a waiting list that’s valid and long, like 2-5 years or longer in some cases, then your master plan should be updated and your airport layout plan should be updated to reflect T-hangars to help you alleviate the shortage.”
Occasionally, aircraft owners on hangar waiting lists may not be ready to use the hangar for a multitude of reasons, even if one becomes available.
“If you’re on the waiting list, call again and make sure they have the correct information that you’re still on the waiting list and that you verified your readiness to move,” Ginter says. “One of the things we’ve learned in the last three years is not all waiting lists are created equal.”
Additionally, Ginter suggests that airport managers be vigilant in monitoring the use of their existing hangars.
“We also ask our airport managers to basically do their existing job, which is to, on occasion, check for compliance with the non-aeronautical use of hangars,” he says. “We’re not trying to bring airport managers down on our members, that would be stupid. But we are in favor of airworthy airplanes being in hangars to help buy gas, need maintenance and increase the financial self-sustainability reports.”
While the shortage has been in place for several years, Ginter believes there is still much to be learned about the scope of the situation.
This article appeared in BCA's Q4 2023 issue.
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