Valuing Airport Facilities

Bill Ingraham

YOU ARE SUCCESSFUL IF:

$in = or >$out

Rate Setting Methods

• Bids or Proposals

• Cost Recovery

• Rental Rate Survey

• Return on Facility Valuation

Valuing Facilities (Appraisal)

• Sales Comparison

• Income Capitalization

• Cost Summation

How to Determine Term

• Set term for all similar leases

• Sufficient term to amortize investment

• How often have you heard…

“But that is not long enough to recover my investment!”

One Method

• Given a cost to develop facilities ($)• Given a rental value for equivalent facilities ($)• Given a return on investment (ROI)• Given an inflation assumption (CPI)

You can find a length of time where investment in developing facilities equals prepayment of rental on similar facilities

Detailed Estimate of Off-Site Costs

Detailed Estimate of On-Site Costs

Detailed Estimate of Indirect Costs

Summary of Development Costs

Valuing Airport Facilities

Bill Ingraham