Mooney Airplane Company Signs 30-Year Low-Cost Lease With Airport in Kerrville, Texas
KERRVILLE, Texas, Mar 1, 2004 (BUSINESS WIRE) -- Mooney Airplane Company, wholly owned subsidiary of Mooney Aerospace Group Ltd. (OTCBB:MASG), has entered into a new lease for its buildings and land in Kerrville, Texas.
Mooney, the City of Kerrville, the Kerr County Commission and the Kerrville Airport Authority have been negotiating for several months according to Mooney President, J. Nelson Happy. "The new lease will be effective for 30 years and adds considerable stability to Mooney's operation. Our old leases were fragmented, covered too much land and only had nine years left to go. We were reluctant to make investments in the physical plant without a long-term lease. The new lease rate is only $1,434 per month for the first 10 years, about 2.5 cents per square foot, then escalates to about $3,263 per month for the next 10-year term. The final 10-year term will be at $6,527 per month. This is very reasonable rent, and Mooney retains title to all of our buildings and fixtures for the entire 30-year term," according to Happy. The base rent escalates annually based on the CPI.
The terms of the new agreement reduced Mooney's leased acreage from 51 acres to the 17 acres the company actually uses. "This will drastically cut our tax burden and eliminate the need for Mooney to maintain several old deteriorated buildings. We are keeping a right of first refusal on the surplus property for 10 years just in case we need it, but I don't foresee any possibility that we will need more than our core 17 acres," Happy stated.
Kerr County Judge Pat Tinley described the lease as a win-win situation for everybody. "I think this is a great step, frankly," he said. "The cooperation between all the entities showed a lot of good communication."
"We were very pleased by the efforts of Kerrville City Manager Ron Patterson and Airport Manager David Pierce who worked long and hard to make this new lease happen," Happy observed. "In fact Mayor Stephen Fine and the entire City Council and County Commission worked efficiently to expedite this new lease."
Sam Rothman, Mooney's board chairman, commented: "We were gratified by the support we received from the Kerrville governmental units. They worked hard to make a fair deal for all, and we think the new lease will help maintain and increase value for our shareholders. Another important factor for Mooney was that our $5 million USDA insured loan required us to have a 30-year lease in place by March 31, 2004. This new lease fulfills that condition, and also provides considerable long-term savings for Mooney. Another plus is that land surplus to us can now be leased to other tenants at the airport, which should stimulate airport development which is also good for Mooney."
About Mooney Airplane Company
Mooney Airplane Company, a wholly owned subsidiary of Mooney Aerospace Group Ltd., is a general aviation holding company, located in Kerrville, Texas. Mooney currently sells five models: the highest performing four-place single engine piston powered aircraft, the Bravo DX, which is available with the Garmin G-1000 glass panel display as the GX; and its stablemates, the highly rated Ovation2 DX and GX, and the economical Ovation. Mooney is celebrating its 51st anniversary in Kerrville, Texas, this year, where it has manufactured more than 10,000 aircraft, which have been delivered worldwide. Complete information about Mooney aircraft is available at www.mooney.com.
SOURCE: Mooney Airplane Company
Mooney Airplane Company, Kerrville
Terry Freeman, 830-792-2935
tfreeman@mooney.com |
