Real Estate & Construction  July 5, 2022

Construction taking off at Centennial Airport as business travel rebounds

This article first appeared on BusinessDen.com, a BizWest news partner.

Flights are on the rise again at Centennial Airport, and so is construction.

The airport had 314,071 takeoffs and landings last year, compared to 334,965 in 2020. And year-to-date in 2022, it has seen 120,289, up 2.5 percent compared to the same period last year, according to airport CEO Michael Fronapfel.

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In order to keep up with demand, an unprecedented number of new developments are in the works at the airport, according to Fronapfel.

“Developers have been waiting in the wings,” Fronapfel said. “We’ve always had limited space here, and they took a step back during the pandemic. But once they started to see air travel come back in a big way, the plans began to snowball.”

He added, “Over the next two years, Centennial Airport will have more hangar and office space under construction than at any other time in our history.”

A rebound for business travel

Centennial Airport, which primarily serves individuals and companies with private planes, is the second busiest general aviation airport in the United States, and the 19th busiest of all airports in the country, according to the Federal Aviation Administration’s 2022 Airport Operations and Rankings Report.

The airport’s current flight activity is a big change from April 2020, when the airport’s then-director told BusinessDen that traffic was worse than post 9/11 as a result of the pandemic.

For comparison, Denver International Airport had 593,916 takeoffs and landings in 2021. Centennial Airport’s record year was in 1998 when it had 466,267 operations, according to Fronapfel.

Centennial Airport sold a record-breaking 16.8 million gallons of fuel last year and, so far this year, it’s sold 7 million gallons, which is 18 percent higher than the same period last year.

“Operations numbers have been trending down until this year and are now slightly up so far,” Fronapfel said. “Fuel sales have been trending higher primarily because our jet traffic has increased significantly over the same time frame.”

The Colorado Department of Transportation’s Division of Aeronautics estimates the airport’s total economic impact at $2.1 billion annually.

‘The first time we’ve had this level of development’

Centennial Airport is home to about 800 aircraft, 150 of which are jets. It has 361 hangars that range in size to hold anywhere from one to seven planes.

An additional six hangars are currently under construction, and a new 18-hangar campus is expected to break ground this summer.

“We knew we’d have two to three hangars developed almost every year, but this is the first time we’ve had this level of development all at once,” Fronapfel said.

Fronapfel said there are about 150 acres left of undeveloped land on the 1,360-acre airport property.

Centennial Airport has four master leases with TAC Air, Denver Jet Center, SunBorne and Modern Aviation. Master leaseholders can develop their property or sublease to other developers. There are also several smaller properties that are leased directly from the airport.

All the leases on the airport are long term, around 50 years, and are reversionary so the land and improvements become the airport’s when the leases expire.

Sky Harbour tackling 18-hangar project

The biggest player in Centennial Airport’s development scene is New York-based Sky Harbour, which is planning to break ground this summer on an 18-hangar campus within 22 acres subleased from SunBorne on the south side of the airport.

The project will be completed in two phases of nine hangars each, totaling 200,000 square feet of hangar space. Each hangar will cater to based aircraft and can fit the largest business jets, like the Bombardier Global 7500 or Gulfstream G700. Interior suites include private offices, lounges, bathrooms and kitchens.

Sky Harbour was founded in 2017 by CEO ​​Tal Keinan. The company opened its first 13-hangar campus at Houston’s Sugar Land Regional Airport in May 2021, and is also developing projects in Dallas, Nashville, Miami and Phoenix.

Also building at Centennial is AeroColorado, which previously built the largest hangar at Centennial Airport.

The local aviation company broke ground on a 15,000-square-foot hangar with 7,000 square feet of office space on the south side of the airport in January and expects to complete it by the end of the year.

AeroColorado, founded by Jack McClurg in 2014, sold its first 56,500-square-foot facility last year for $14 million to a Fortune 500 company, according to AeroColorado’s broker Iver Retrum, who also owns aviation consulting firm Business Aviation Group with McClurg.

This new hangar will not be for sale, though. McClurg, who is also the co-founder of private equity fund J&K Capital, plans to use it as his personal hangar, Retrum said.

“Developing a hangar at Centennial Airport is going to be a very nice investment,” Retrum said. “The airport has done a great job in creating an environment for developers to succeed in. Centennial is damn busy and it’s only getting busier.”

On top of AeroColorado’s and Sky Harbour’s development plans, five other hangars are currently under construction at the airport.

VF Corp., the apparel manufacturer behind the North Face, Timberland and Smartwool brands, paid $10.3 million for two parcels totaling 1.3 acres adjacent to Centennial Airport in 2019, according to previous coverage.

In order to have access to the airport, VF Corp. pays an access fee that is equivalent to what it would cost for it to lease the property from the airport, according to Fronapfel.

The company, which moved its headquarters from North Carolina to downtown Denver in 2019, is building a 55,000-square-foot facility with a 35,000-square-foot hangar for its corporate aircraft, office space, a lobby and indoor parking. It’s expected to be completed by the end of the summer.

Modern Aviation, a fixed-based operator at Centennial Airport, is more than doubling its footprint on the south side of Centennial Airport. Fixed-based operators provide amenities to the general aviation community, like fueling, parking and hangar space.

Last September, Modern Aviation broke ground on a $20 million complex that will feature a 7,000-square-foot fixed-based operator terminal, two large hangars totaling 52,000 square feet, a 4,000-square-foot office space and 135,000 square feet for a new aircraft ramp area. It’s expected to be completed by the end of the year.

Modern Aviation, a fixed-based operator at the airport, is doubling its footprint with a new $20 million complex. (Lily O’Neill/BusinessDen)

Nearby, Floors and Doors is constructing another $20 million project with a 30,000-square-foot hangar that can fit six jets, a three-story, 38,000-square-foot office with a rooftop patio and a new airplane ramp. The project, expected to be completed by the end of the year, is being designed by Denver-based TreanorHL and built by Denver-based Hyder Construction.

Floors and Doors is affiliated with BlownMortgage, which helps direct customer traffic to mortgage websites, according to a state filing. Floors and Doors already has a 20,000-square-foot private hangar with a 10,000-square-foot office building that it completed in 2020.

And last, but not least, Denver-based Vmax Capital is building a 20,000-square-foot hangar with a 1,000-square-foot office space on the north side of the airport. Vmax is directly leasing this property from Centennial Airport. The company is co-managed by Don Berland with Berland Development group, who developed the Willowbrook Hangars a little over 20 years ago before partnering with Vmax Capital.

“These new developments will help meet the demand for additional space to store jet aircraft and will only increase our traffic slightly while providing increased revenue from property leases, fuel sales and support services,” Fronapfel said.

This article first appeared on BusinessDen.com, a BizWest news partner.

Flights are on the rise again at Centennial Airport, and so is construction.

The airport had 314,071 takeoffs and landings last year, compared to 334,965 in 2020. And year-to-date in 2022, it has seen 120,289, up 2.5 percent compared to the same period last year, according to airport CEO Michael Fronapfel.

In order to keep up with demand, an unprecedented number of new developments are in the works at the airport, according to Fronapfel.

“Developers have been waiting in the wings,” Fronapfel said. “We’ve always had limited space here, and…

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