A general aviation facility improvement plan that’s been years in the making for John Wayne Airport appears poised for liftoff, after the county’s Board of Supervisors recently selected a new set of fixed-base operators (FBOs).
The FBO selection is expected to lead to nearly $150 million in new investments for the county-owned airport over the next eight or so years, representing the most notable investment at JWA since 2011, when the airport’s new Terminal C opened as part of a more than $500 million expansion effort.
Some 500 private general aviation aircraft—whose assorted users include private pilots, small plane owners as well as owners of multimillion-dollar corporate and personal jets—are expected to see a major upgrade of the facilities they use along the southern edges of JWA.
The FBOs selected by the county are also promising improved and streamlined operations at the airport.
“I think we will definitely see an increase in quality control and customer satisfaction,” said Bill Borgsmiller, founder and chief executive of ACI Jet, one of the three FBOs selected.
The county’s three selections—two full-service FBOs, and one limited-service FBO—“will shape the future of John Wayne Airport in a positive manner,” added Board of Supervisors Chairwoman Michelle Steel.
General aviation services at JWA—comprised of all flight operations at the airport outside of those provided by commercial airlines, such as Southwest or American Airlines—has not seen a major upgrade since 1990, when the last hangars for smaller-sized aircraft were built.
The just-approved public-private partnership is expected to change that, adding new hangars, offices and other facilities in an effort largely funded by the three FBOs: ACI Jet, Clay Lacy Aviation and Jay’s Aircraft Maintenance.
FBOs provide full-service fueling operations; aircraft repair and maintenance services; charter operations; and aircraft wash facilities. They also manage hangar and tie-down facilities and transient aircraft parking.
Each of the three FBOs currently have a presence at the airport. Their new leases at JWA will run 35 years; terms of those leases have yet to be finalized and require sign-off by four of five members of the Board of Supervisors, which some industry watchers say could present challenges.
The deal could mark a surprising end to Atlantic Aviation’s 17-year presence at the airport as an FBO. The firm had the highest score of any FBO applicant in a request for proposals (RFP) related to the new lease, according to county records.
Small Plane Pushback
The county’s General Aviation Improvement Plan was conceptualized more than a decade ago, born out of the need to upgrade a roughly 67-acre portion of the airport that houses small and large private jets, maintenance facilities, flight schools, fuel services and other non-commercial operations.
General aviation accounts for a majority of the airport’s total aircraft takeoffs and landings, though commercial airlines represent the bulk of travelers served at JWA (see story, this page).
New runway setback requirements mandated by the Federal Aviation Administration brought about concerns over future use of the general aviation space, with acreage for those uses cut back to 60 acres.
Small plane owner and pilot Fred Fourcher has been vocal in support of maintaining space at JWA for smaller general aviation aircraft in the newly configured aviation space as co-founder of the SoCal Pilots Association.
“The initial plan called for 250 small planes to leave the field, which opened the door for a much-expanded jet operation,” Fourcher told the Business Journal.
Local community groups—such as Still Protecting Our Newport and the Airport Working Group—that have historically been vocal in noise, pollution and curfew issues relating to the nearby airport, also shared this concern.
Supervisor Steel came up with a solution, colloquially referred to as the Steel Amendment, which dedicates space for smaller general aviation aircraft.
The amendment limits medium and large general aviation jet aircraft to 25.6 acres while designating 34.6 acres exclusively for small general aviation aircraft.
“I am dedicated to achieving our community’s goals to reduce noise and pollution, limit operation hours, and build out the light general aviation area with individual hangars consistent with the existing mix of planes,” Steel, whose Second District includes Newport Beach, said in a statement.
During the RFP process, which had seven respondents, Clay Lacy and ACI Jet independently voiced their support of requests from the community and pilot associations.
“Since the beginning, these two companies listened to the community and met with us pilots, and we got to know them pretty well,” Fourcher said. “They are invested and committed to maintaining this balance.”
In separate interviews with the Business Journal, executives of these two companies spoke of their operations as supportive of an “ecosystem,” with equal focus on each client, from a flight student to large private jet operators.
“We want to take care of the little guys,” said ACI Jet’s Borgsmiller, whose firm is based in San Luis Obispo.
Specific language that limits the expansion of larger jets—thus preserving the small plane presence at JWA—still needs to be finalized in the new FBO leases, Fourcher noted.
ACI: The Underdog
ACI Jet is the newest FBO at John Wayne, taking over operations in 2017 for Signature Flight Support, one of John Wayne Airport’s two full-service facilities for charter carriers and private-aircraft owners at the time.
Long-term operators Signature and Atlantic Aviation had reportedly faced pushback from users of their facilities due to high pricing, specifically for fuel, which prompted a temporary bid for new FBOs.
ACI secured the 18-month lease that ran until the end of 2018, at which point the bid process began again, this time for the 35-year lease.
“It was a big project to take on, and a big risk, as we didn’t know if we would be able to stay on after the lease was up,” Borgsmiller said.
The company invested north of $1 million in deferred maintenance for the facility, which was in bad shape, Borgsmiller said.
“We made a lot of promises to get the opportunity, and we delivered in spades.”
The company went from a relatively unknown newcomer to the largest provider of fuel in the general aviation side of the airport, while also drawing plaudits from clients like local auto tycoons Fletcher Jones and Dave Wilson of Wilson Automotive Group, as well as the Los Angeles Chargers owner Dean Spanos. All three wrote in support of the company for the FBO bid.
Since 2017, ACI has doubled its local employment to 80—it employs 200 companywide—and is ready to hire more as it plans for the expansion of its 30-acre parcel.
The company said it will invest $85 million over the next eight years in the build-out its facilities at JWA, which includes hangars for small and large jets, maintenance and fuel servicing areas, and new offices.
“We will replace outdated facilities in a phased approach,” Borgsmiller said. “We want to create the most efficient use of our space and modernize it for the long term.”
Clay Lacy: Community
ACI Jet, which will operate out of the northeast portion of the general aviation facilities at JWA, has also made community involvement a company staple.
In addition to making concessions based on community and pilot concerns, the company has been pairing with local schools in educational field trips, and has added community events at the airport.
Clay Lacy is no different.
The Van Nuys-based company operated out of John Wayne for several years, during which it has established a partnership with the Orange Coast Community College’s Aviation Science program, providing four scholarships each year.
“Those students are the future employees of companies like Clay Lacy Aviation,” said Senior Vice President of Business Affairs Scott Cutshall, who learned to fly at John Wayne Airport; his father flew for AirCal out of John Wayne.
“By supporting efforts like this, we are investing in the future of the airport, which operates as an ecosystem.”
This school will play a role in the build-out of Clay Lacy’s new 15-acre airport parcel, whose upgrades will include new offices and teaching space.
Currently, Clay Lacy is a charter plane operator at John Wayne, and provides aircraft management service for four privately owned planes. It also has a relatively small maintenance team on-site.
The company is a full-service FBO, management, charter, and maintenance provider based out of Van Nuys, with 500 employees across 26 locations in the U.S.
As one of the newly selected FBOs at John Wayne, its local operations will significantly increase when its lease begins at a yet-to-be determined date.
Clay Lacy says it will invest $50 million over the next three years in the build-out of its facility, which will also include the construction of the new OC Sheriff’s flight facility; a new FBO terminal; three 33,000-sqaure-foot hangars; and additional offices.
Jay’s JWA History
Jay’s Aircraft Maintenance, meanwhile, has been selected as a limited-service FBO; its primary difference from ACI and Clay Lacy is that it won’t offer charter operations.
The firm, owned by Jay Ghanbarzadeh, has operated out of John Wayne for 35 years, primarily performing maintenance on smaller general aviation aircraft. It built and has maintained the four hangars at its facility since 1990.
General Aviation Fares Better than Commercial
Commercial operations at John Wayne Airport, typically the result of more county attention and investment, have been seeing steep traffic declines since March as a result of the coronavirus pandemic.
General aviation, while still trending down, is faring better, due in large part to a renewed interest in private travel for smaller, chartered planes.
As of July, all flights at JWA were down 25% year-to-date from 2019.
Commercial has seen a 46% drop in flights to and from the airport; general aviation is down just 16% in comparison, with July flights flat year-over-year.
ACI Jet, a fixed-base operator at John Wayne Airport since 2017, has seen a year-over-year jump in revenue due to a new customer base.
“We have seen a huge new entrance into private aviation in the market,” said Bill Borgsmiller, founder and chief executive of the San Luis Obispo-based firm. “People are traveling less, but they are choosing to travel private when they do.”
General aviation, like commercial operations, is also contingent to the airport passenger cap, which currently sits at 10.8 million passengers but will increase to 11.8 million passengers for 2021 through 2025.
“There’s only so much room to grow, and the airport is already mature in terms of planes,” Borgsmiller said.