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City to gauge interest for hangar projects

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The Roswell International Air Center is a designated federal Opportunity Zone. Investments in those zones are designed to give investors significant tax advantages, says Erik Harrington of RBC Capital Markets during a Thursday meeting of the Airport Advisory Commission. (Lisa Dunlap Photo)

The city of Roswell plans to release information soon on two hangar projects at the Roswell International Air Center as it seeks potential developers and investors.

Two Requests for Information are expected to be released publicly and sent to aviation industry members and potential developers, tenants and investors by the end of next week, said Mark Bleth, Air Center manager, during a Thursday meeting of the City of Roswell Airport Advisory Commission.

The requests, which probably will be open for about 60 days, are intended to provide information on and gauge market interest in building a wide-body hangar for large commercial aircraft and for T-hangars or box hangars for private aircraft.

After obtaining information, the city could follow up with responders; issue requests for proposals, which would require approval of the City Council; or decide to refine the projects or put them on hold.

The city and its consultants have worked for about six months to create some initial designs, cost estimates and possible site locations for the projects so that interested parties would have some idea of what would be entailed.

According to draft documents, the 10 to 20 T-hangars or box hangars for single-engine aircraft would replace 10 T-hangars now on the airfield that would be demolished once the new hangars were built. The existing hangars are all leased, with the air center having a waiting list of possible tenants, the city document indicates.

The wide-body hangar project would be for developers willing to build on speculation or for tenants involved in aircraft maintenance and repair, manufacturing, painting, research and development, flight testing or related aviation activities.

It is intended to hold a large 777 aircraft or multiple 737s or Airbus airplanes. Air Center staff have said that many of the existing hangars on the airfield, most of them built in the 1940s or 1950s, are not suited for some of the wide-body commercial aircraft on the market today. Some also lack the electrical systems or structural integrity needed for work with modern electronics, mechanics and computerized systems.

A possible incentive for building the projects here is that the Roswell International Air Center is in a federal Opportunity Zone.

Erik Harrington with RBC Capital Markets, reviewed with the commission the nature of Opportunity Zones, established by U.S. Congress as part of the 2017 Tax Cuts and Job Acts.

Opportunity Zones are meant to attract private investment into low-income, underdeveloped areas by giving tax incentives to investors.

People who have earned capital gains from the sales of businesses, bonds, stocks, property or other transactions can put their money into funds that invest in Opportunity Zone projects, with federal taxes being deferred, reduced or eliminated. Chaves County has three Opportunity Zones.

Harrington explained that many banks and financial groups, including his company’s New York office, are still in the process of forming the funds that would invest in Opportunity Zone projects. Internal Revenue Service guidance is still needed on some aspects of the law, he said.

“As these funds are created, now these funds will be looking for investments in areas that they know have viable investments, that have a commercial development that has a good ROI (return on investment),” Harrington said.

Kintigh said he thought the Opportunity Zone would be an important fact to include in the requests for information.

“I think this is one of the more intriguing aspects of Roswell that we have not really understood completely what the potential implications are,” said Kintigh. “We’ve had some dealings with some potential developers outside of the airport, but this has really gotten me intrigued. Hopefully this can be a huge catalyst for us.”

Senior Writer Lisa Dunlap can be reached at 575-622-7710, ext. 311, or at reporter02@rdrnews.com.