Helicopter Lease CostRentalprice for Helicopter
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Fleet of helicopters for rental - Bell, Sikorsky, Eurocopter
Bell 206L4 provides high load capacity and reliable performance at competitively priced total cost of ownership. Bell 407 provides a high degree of versatility. Bell 412 is an industrial working horse developed for a wide range of applications in the field of passengers and supplies. S76 C++' low vibrational level allows the helicopter to be perfect for different market and configuration requirements.
Sikorsky' S76 C is a medium-size universal helicopter with a four-bladed primary and secondary rear rotors and retractable undercarriage. Sikorsky' S76A++ is a medium-sized supply helicopter driven by two Turbomeca thrusters.
A new era in helicopter operational lease
Although helicopter lease is not a new phenomena, a number of committed wealth management companies have emerged in the last two years. You can recognize Bristow's choppers by the company's bright colors of pink, blue and blue. Speaking at an Investors' Analysts' Day in April 2013, the British Group announced that it had received 15 offers to rent a helicopter to take over UK Search and Rescue (SAR) operation.
Mr. Bristow said she has entered into a memorandum of understanding with Milan Aviation Group to be the principal leaseholder and the business is in talks with other leasers. Although helicopter lease is not a new phenomena, a number of committed wealth management companies have emerged in the last two years. The first to announce its helicopter lease product in 2010, milestone was followed by LCI Aviation, an already incumbent solid wings lease, Waypoint, which received a $375 million capital audit last month, and Lobo Lease, which is strictly monitoring its policy and the identities of its shareholders.
This does not mean that operational leases are new in this category. During the 1980s, Richard Santulli, NetJets founding father, acquired a helicopter to rent to an operator. Until 1986 he was building a family of 192 helidopters. When he entered the Fractional Property business, he used to sell the choppers to finance his new projects and sell 190 out of 192 choppers at a higher purchase cost than the first.
It' s no wonder that Santulli has re-entered the helicopter lease business with its latest Milestone Aviation Group investment vent. These distinctions between operational lease contracts provided by bankers and lessees are important and crucial for the launch of several new lease agreements on the aviation rental markets. "Our client list sees the value of non-banking lease providers - this is our chance for growth," says Ed Washecka, CEO of Waypoint Leasing.
That is definitely the case with utility helidecks. Whereas, according to some estimations, the value of business aircraft fell by as much as 50 percent after the onset of the global economic downturn, medium-weight aircraft recorded a fall of 10 percent at most. Mileestone and LCI have already entered into several contracts. With over 90 aircraft leased to approximately 20 clients around the globe, LCI has contracted all its 2013 helicopter supplies and is working on 2014 contracts.
Orders for three-digit million Euro choppers have been placed by both airlines. In March, Waypoint, which also concluded a rental agreement last months, also placed a contract directly with the producer AugustaWestland. The Lobo Leasing, initially supported by Perella Weinberg Partners, has not placed any orders for planes and has not disclosed who its stockholders are.
As well as the lessees who have awarded directorships to vendors, all four lessees will offer sale-leasebacks for alternative devices that offer funding options to owners. However, they are encouraging by the tendency towards deep boreholes, which will require helicopter transportation and lead to sustainable revenues. And there will be a huge need for replacements, says Kelly, who finds that 35 percent of the civil helicopter population is over 20 years old.
Besides longterm appealing chances in the markets, the economic downturn after the global economic meltdown has generated a growing need for financing alternatives after many aggresive actors reduced their credit allocation in 2009. With this new surge of leasing companies, there is a need for a new source of finance and some companies would prefer to keep money.
However, in addition to investing in the asset's own capital, there are other significant advantages to lease. Since the early 2000s, CHC Helicopters has been using structural finance for the lease of airplanes to finance its air transport equipment since the beginning of the 2000s. McGinn actually says most of the lease is on the property. It admits that so far there has been nothing comparable to what has happened to civil air transport operators.
As CHC uses exports credits, financers of banking equipments and insurers to finance the purchase of aircrafts, the firm also talks to operational leasing providers. The Bristow Group, on the other side, which could not make a statement on this item due to a blacking out phase, said at an analysts' conference in April that the bulk of the choppers would be under lease in its UK SAR deals.
With the UK SAR deals included, the airline wants to increase the overall number of lease contracts from 15 percent to 30 percent. Speaking at the session, Bristov managers said that lease helps to reach "very competitive low cost of lessor's capital". Whilst developing its lease portfolio, the firm continues to operate a proprietary trading scheme and will service its own helidecks.
"Kelly says, "We thought we could get into the business and really help some small and midsize businesses build their fleet and provide competitively priced solution for larger businesses. Recently Millestone has rented planes to multinational clients in India, Indonesia and Mexico as well as to major helicopter carriers such as Bristow and CHC.
Operational leases provide smaller players who may not have advance funds to reinvest in the asset's own funds, have no recourse to inexpensive borrowings to make a business profitable, or do not have the engineering and assets capacity to manage it. "As we ( and operators) can inform the markets about the advantages of lease, this will lower the cost of ownership for the entire sector, leading to lower costs," says Washecka.
However, this deterioration does not occur in the case of a helicopter due to servicing and exchange. So Santulli was able to buy so many choppers at higher price than what he had bought. With Santulli's 99 per cent return on his helicopter investment, one can say that the four above mentioned firms are making a good one.
However, the utility helicopter segment is still small compared to the main utility helicopter segment in number and value of planes shipped in 2012 (approximately $85 million). The General Aviation Manufacturers Association reports that around 3.36 billion dollars in choppers were shipped in 2012. Much of this value comes from the 214 dual engine turboprop deliveries, but also 328 reciprocating and 502 mono-engine helidecks.
The four joint venture partners will aim for dual engine aircraft as their main markets. That raises the issue of whether the small size rental platform is saturated. There is agreement among analysts that there could be capacities for one or two extra helicopter rental firms. Rumours have it that another firm (not mentioned in this article) is talking to PE firms about obtaining funds to get into this area.
Over the next few years, leasing companies should reckon with tough competitive conditions from which operating companies will profit.