Page 29 - FON Spring Issue

FON AIRCRAFT
Given the luxury, convenience and — amidst global health concerns —safety that private aviation affords, it comes as little surprise that a growing number of family offices are looking into aircraft acquisition.
Purchasing an aircraft is a major decision, regardless whether your family is a first-time buyer or an experienced owner. For any family office involved in the structuring and management of private aircraft assets, there are a few key things to know about new aircraft acquisition:
1. Understand how your family intends to use their aircraft.
It’s incredibly important that your family understands how you intend to use the aircraft, as this will impact everything from which aircraft models you should consider to whether you are eligible for certain tax benefits. To begin, family offices should consider asking themselves the following:
• Do you intend to use your aircraft primarily for business purposes?
• How frequently do you intend to fly?
• Do you intend to primarily fly domestically or
internationally?
• Will it be just one or two people flying on a regular basis, or will additional capacity for larger groups of passengers be required?
Understanding your intentions is the first step to finding the appropriate aircraft model for your unique situation.
2. Determine what’s important to your family members.
Intended use is just the beginning — you must also find out what’s important in a new aircraft. For example, some families might want to optimize for cabin size, while others might prioritize speed or range. Many aircraft models can satisfy the vast majority of defined requirements, but they might not meet them all. For this reason, it’s important that family offices understand which of their requirements are top priority, and which ones are merely wish list items.
3. Follow the 80/20 rule.
With the truly vast array of private aircraft models on the market today and the luxurious amenities they have to offer, it can be tempting to go all in and purchase an aircraft that far exceeds actual needs. In situations such as this, we advise that family offices follow the 80/20 rule — that is, that they steer towards an aircraft that will meet their mission requirements 80% of the time. Again, it’s impossible to overstate the importance of understanding intended use because this helps define mission requirements.
H. Lee Rohde III is the founder, President and CEO of Essex Aviation Group, Inc., a business and private aviation aircraft acquisition and consulting firm located in Portsmouth, New Hampshire.
FON MAGAZINE / SPRING ISSUE 2021 / FONMagazine.com 29