Long Beach Finalizes $60 Million Private Jet Campus Deal with Sky Harbour

Long Beach Secures $60 Million Private Jet Campus with Sky Harbour

The City of Long Beach has finalized a significant, long-term agreement with Sky Harbour Group Corporation, an aviation infrastructure company, to develop a $60 million private jets campus at Long Beach Airport (LGB). This 50-year ground lease marks a pivotal investment in the region’s aviation future, aiming to address a critical shortage of private aircraft hangar space in Southern California. The project is poised to transform a 17-acre parcel of largely underutilized land on the west side of the airport into a state-of-the-art facility for business aviation. This move solidifies Long Beach’s position as a key hub for private and corporate travel, promising substantial economic benefits for the city and the surrounding communities.

The development is part of Sky Harbour’s broader national strategy to create a network of “Home Base Operator” (HBO) campuses. This model focuses on providing premium, dedicated hangar and office facilities for based tenants, a departure from traditional Fixed-Base Operators (FBOs) that often rely heavily on fuel sales. The Long Beach campus represents Sky Harbour’s 19th location in the United States and its third in California, signaling strong confidence in the region’s market. The project is not just about infrastructure; it’s a strategic move to recapture business that has been lost to other states due to a lack of adequate facilities.

With construction planned in phases and an expected completion by spring 2028, the campus is set to feature five large hangars, an open-air public restaurant, and modern amenities. This development is anticipated to generate hundreds of local jobs and inject significant revenue into the local economy. As the demand for private aviation continues to grow, this partnership between Long Beach and Sky Harbour is positioned to meet the needs of a burgeoning industry while fostering local economic growth.

Project Scope and Financials: A Deep Dive

The agreement outlines a comprehensive plan for the 17-acre site. The core of the $60 million project involves the construction of five hangars, each spanning approximately 43,000 square feet. These structures are designed to accommodate up to 25 ultra-long-range business jets, the larger, more modern aircraft that are increasingly in demand. Beyond simple storage, each hangar will be a self-contained unit featuring a lounge, storage areas, office facilities, and electric vehicle charging stations, catering to the high standards of corporate and private clients. A notable feature of the campus will be an open-air restaurant, which will be accessible to the general public, integrating the facility with the local community.

The financial structure of the 50-year ground lease is designed to provide escalating revenue for the city. Sky Harbour’s payments will begin at $29,778 per month in the first year, increasing to $48,389 in the second. Once construction is complete, the monthly lease payment will jump to $78,166, with a built-in 3% annual increase thereafter. This phased approach ensures a steady and growing income stream for Long Beach over the life of the lease, transforming a “largely vacant” piece of land, previously used for events and vehicle storage, into a productive, revenue-generating asset.

The land itself is currently used for events like the annual Festival of Flight and for vehicle storage by Mercedes-Benz. Councilmember Megan Kerr expressed satisfaction that this underutilized parcel would finally be developed. The project’s timeline, with a completion goal of spring 2028, reflects a multi-phase construction process designed to bring the campus online efficiently while managing the complexities of airport development.

“This agreement underscores Long Beach as an important hub for business aviation, which brings investment, jobs, and revenue directly into the City and communities throughout our region.” — Cynthia Guidry, Long Beach Airport Director

Economic Impact and Industry Context

Proponents of the deal emphasize the significant economic benefits it promises for Long Beach and the wider Southern California region. The project is expected to create or sustain hundreds of local jobs, spanning construction, aviation services, and hospitality. This aligns with the broader impact of the business aviation industry, which supports over 1.2 million jobs in the U.S. and contributes an estimated $247 billion in economic output. By providing high-quality infrastructure, Long Beach aims to attract and retain a larger share of this lucrative market.

A key driver for this development is the pronounced national shortage of hangar space, particularly for the larger jets favored by corporate clients. Eric Stolpman, Senior Vice President with Sky Harbour, noted that this scarcity has forced many Southern California-based aircraft owners to house their jets in other states like Arizona, Nevada, and Utah. This “re-basing” of aircraft back to where their owners live is a central goal of the project. It allows the local economy to capture fees, taxes, and other spending that would otherwise be lost. Stolpman identified Long Beach as the “future growth spot” for business aviation in the entire Southern California area.

While the economic upside is clear, it is also important to consider the broader context of the private aviation industry. The sector has seen substantial growth, with the number of private jets more than doubling since 2007. However, this growth comes with environmental considerations, as private jet travel is the most energy-intensive form of transportation per passenger. Critics also point to discussions around taxation, arguing that private aviation contributes a relatively small percentage of the taxes that fund the Federal Aviation Administration (FAA) despite its significant use of the airspace and publicly funded airports.

Conclusion: A Strategic Investment in Aviation’s Future

The partnership between the City of Long Beach and Sky Harbour represents a forward-looking strategy to capitalize on the sustained growth of business aviation. By transforming an underused plot of land into a premier private jet campus, the city is not only addressing a clear market demand but also creating a durable source of revenue and employment for decades to come. The $60 million investment is a calculated move to position Long Beach Airport as a critical node in the national private aviation network, attracting high-value clients and stimulating the regional economy.

As the project moves toward its 2028 completion, it will serve as a case study in public-private partnerships for airport infrastructure development. The success of the campus will hinge on its ability to deliver the premium, efficient service promised by Sky Harbour’s unique HBO model. While the broader conversations around the environmental and tax equity aspects of private aviation will undoubtedly continue, this development in Long Beach stands as a firm bet on the industry’s continued importance as a driver of business and economic growth.

FAQ

Question: What is the total cost of the Sky Harbour project at Long Beach Airport?
Answer: The project is valued at $60 million.

Question: How long is the lease agreement between Long Beach and Sky Harbour?
Answer: The City of Long Beach approved a 50-year ground lease with Sky Harbour.

Question: What will the new campus include?
Answer: The campus will feature five large aircraft hangars designed to hold up to 25 ultra-long-range business jets, office space, lounges, EV charging stations, and an open-air restaurant that will be open to the public.

Question: When is the project expected to be completed?
Answer: The construction will be done in several phases and is expected to be finished by the spring of 2028.

Sources: Long Beach Post