How Art Basel and Uber-style apps are helping fuel Miami’s private jet industry by Rob Wile
November 30, 2018 10:01 AM
Updated December 02, 2018 06:54 AM
Art Basel’s Miami Beach fair brings booming business for many high-end service providers. Think $500-per-night hotels, celebrity-chef restaurants, caterers, chauffeurs.
Add private jet travel to the list. Spurred by Art Basel and the dozens of other art fairs opening this week, this once-sleepy South Florida industry is taking off.
And it’s not just the art crowd taking to their own personal skies. As well-heeled business people flee tax-heavy states — and cold weather — in favor of South Florida, more private flights are taking off and landing in South Florida.
Two decades ago, flying private meant chartering by the flight — or owning a plane outright. Today, travelers with means can join jet-sharing programs that allow them easy access to private flights. The services don’t come cheap. But custom flight schedules, minimized security hassles and app-enabled booking add to the appeal of a bevy of private jet membership or ownership service companies. These include NetJets, Wheels Up, XOJET, Sentient Jet, JetSmarter and BLADE. Together with the on-the-ground terminals that facilitate private flights, called fixed-base operators, it all adds up to more than 8,000 jobs and a local industry valued at about $800 million.
“There are a couple of things at play with South Florida,” said Brian Proctor, president and CEO of Mente Group, a Texas-based private jet consulting firm. “First, of course, is the weather. But it’s also a fairly healthy state economically, and the income tax law continues to be a draw for people from more highly taxed areas,” he said. “We’ve had several clients that have moved there from Chicago, New York and Connecticut. And that’s where they’ve moved their airplanes to.”
The surge has helped vault Miami Opa-locka Executive Airport into the top-20 busiest private-aviation strips in the U.S., according to FAA rankings. Just a decade ago, it was 63rd.
Overall, according to private jet search engine PrivateFly, South Florida airports are seeing 35 percent growth in private travel versus last year, excluding hurricane-related disruptions.
Andrew Collins, president of Sentient Jet, one of the world’s largest jet card providers, ranks Art Basel alongside the Super Bowl and the Kentucky Derby in event-driven traffic. As a result, Sentient’s South Florida membership has climbed to 240 cardholders, up from about 160 in 2015.
Doug Gollan, founder and editor of PrivateJetCardComparisons.com, a site comparing more than 250 private jet membership programs, moved to South Florida six months ago to take advantage of the region’s new wave of private-aviation users.
“South Florida has always been a hub for private aviation,” he said. “It’s not only a wealth center, but also a location for second homes.”
But one look at recent developments on Miami’s skyline, he said, shows a new wave of users flush with wealth are interested in making South Florida a more permanent part of their lives.
“Private aviation follows that,” he said.
Spend too much time on Instagram, and you might believe the typical private jet user to be an A-list model or DJ.
That is far from the case, especially in South Florida, according to aviation industry executives.
Gollan said both his biggest customers, and the industry’s, are wealthy professionals like doctors or lawyers, and C-suite executives or business owners. These fliers may travel between two homes, jet off on vacation, or need to meet with clients based elsewhere.
“The common denominator is, they probably have net worth of $5 to $10 million, with many worth $50 million or mor,” Gollan said. “For the upper end, the last few years have been good.”
Justin Firestone, founding partner at private jet membership club Wheels Up and its head of South Florida operations, explained that for many clients, catching a private air lift is a way to make business time more productive. Case in point: On a recent Friday morning, a principal at a Coral Gables law firm boarded a Wheels Up jet at a private facility at Miami International (no standing in a security line), had a lunch meeting in Augusta, Ga., then used the plane’s Wifi and cell service to conduct business on his way home, landing in time for dinner back home.
Making the trip via commercial carriers would be far more cumbersome. For the “working wealthy,” as Wheels Up calls them, private aviation offers one of the scarcest commodities in the world: time.
Said Firestone: “If you asked that individual, who bills by the hour, it’s the most productive use of their time,” he said. “We’re not talking about folks posting photos for social media.”
One South Florida Wheels Up member is Rodney Barreto, founding partner of consulting firm Floridian Partners, LLC and president and CEO of The Barreto Group, a diversified company specializing in corporate and public affairs consulting, real estate investment and development, and healthcare data management.
Barreto purchased his first private jet 15 years ago, and a second one several years later. He joined Wheels Up as a way of maintaining his access to private travel when either of his planes are unavailable, usually for maintenance.
Barreto explained the importance of having instant access to jet travel.
“If I fly to Tampa for a fundraiser for an elected official, and afterward there’s a private dinner, I don’t have to rush,” he said. “I can stay until 11 p.m., or 1 a.m. even. It’s a luxury, but it allows you to finish an important conversation. That’s important when you’re negotiating.”
Just a few years ago, booking a private jet involved making multiple telephone calls, sometimes weeks in advance. No longer: A slew of companies now provide apps that put a private jet flight a finger’s tap away.
Signing up doesn’t come cheap. But it’s far less than the multimillion-dollar price of owning a private jet and keeping it fueled. Not to mention hiring a pilot and crew.
Though each of these companies offers a high-flying version of ride sharing, they vary in destinations served, equipment flown, and pricing. A seat from Miami to New York on one of BLADE’s retrofitted, 16-seat Bombardier CRJ 200s costs $2,250, while NetJets offers services ranging from part ownership in a Gulfstream 450 — price quoted upon request — to an annual membership card starting around $165,000 for 25 flying hours.
Clients get more than just the ride; most planes are stocked with high-quality food and beverages, along with personalized concierge services (think flight attendants who greet you by name and remember your drink and seating preferences). And as more companies enter the jet card or jet sharing market, these companies now compete on side perks and experiences that come with membership, such as luxury hotel stays and exclusive tailgating parties at the Super Bowl.
At Art Basel, experiences will include Wheels Up’s “Wheels Down” party; a free two-night stay at the Faena Hotel for BLADE members, Sentient Jet’s luncheon with Sotheby’s art experts and NetJet’s VIP lounge at Art Basel.
The Opa-locka Turnaround
Today, many private jet travelers—especially ones traveling to Art Basel—arrive at Opa-locka Executive Airport. About a decade ago, that would have been unlikely.
“Years ago, Opa-Locka was faint on the radar,” said Bobby Courtney, vice president of aviation at Fontainbleau Aviation. “Today flying into Fontainebleau means access for our privileged clientele, we invested in peace of mind for all of our guests by providing a premium facility with full-service amenities to match.”
“Today, the days of everyone going into Miami International, or Fort Lauderdale International, those days are changing,” he said.
In 2010, Turnberry, which owns the Fontainebleau Resort and Aventura Mall, invested $27 million to remake its Opa-locka flight center into a full-scale FBO. It opened as Fontainebleau Aviation in 2012, and is now one of the nation’s premier flight hubs. Today, Fontainebleau sees between 70 and 90 takeoffs and arrivals a day — a number that can surge to 120 during special events like Miami Art Week. It has grown from a handful of employees a decade ago to about 80 today.
This year, Opa-locka was named Airport of the Year by the state of Florida, thanks to the presence of top-rated FBOs like Fontainebleau.
“Opa-locka continues to be the status hub for the area,” said Adam Twidell, founder and CEO of PrivateFly, the jet charter search engine. “They have really, really fantastic facilities there — it’s great if you want to make an entrance.” It’s also convenient to Miami Beach and downtown, and far less expensive than Miami International Airport.
Bombardier, the maker of Learjets, recently announced it would build a $100 million, 300,000-square-foot maintenance facility at Opa-locka.
“If the traffic is already going in and out of the airport,” Bombardier vice president Jean-Christophe Gallagher said, “it’s a natural to have a service facility next to that airport.” The company predicts it will be the busiest in its global network of repair shops.
According to Miami-Dade County, operations — meaning flights leaving or arriving — at Miami Opa-locka Executive fell slightly from 2014 to 2017 — from 145,389 operations in 2014 to 136,556 last year. The culprit: construction and severe weather events. This year, operations are up 17 percent through October year over year, which would put it at nearly 160,000 operations for the year.
By comparison, Miami Executive Airport (formerly Kendall-Tamiami Executive) operations grew from 260,000 in 2014 to 300,307 in 2017; though many are student training flights.
And at Miami International Airport, private aviation has remained flat, with 18,607 flights in 2014 and 18,049 in 2017.
Labor Shortage — and a downturn?
Demand for private jet services in South Florida has become so great that FBOs like Banyan Air in Fort Lauderdale, another top-rated South Florida operator that already employs about 200 people, is facing a labor shortage.
“It just gets challenging to find warm bodies,” senior vice president Mike O’Keeffe said.
After World War II ended, military pilots returned to a growing commercial industry. But that pipeline of interested bodies has run out.
“A lot of millennials don’t have that passion for being around airplanes and smelling jet fuel,” O’Keeffe said. “Those of us in the pilot business are paying the price.”
At the same time, some are wondering how long the current boom can last as many economists predict a recession sometime in the next two years. Private jet executives are often heard saying their industry is the canary in the coal mine: When margins get thin, jet travel often dries up.
But businesses like Wheels Up believe their model will help insulate them from any downturn. Firestone argues that a $60 million corporate fleet will be the first thing to go in a downturn, while an $80,000-per-member utility is more likely to get overlooked in a line-item cutting scenario.
For Proctor, it all comes down to the time factor.
“One thing about aviation, something these guys can’t buy is time,” he said. “They get more time in life, more time with customers, selling services, it’s a multiplier. It’s an investment people are getting more comfortable with.”
These companies offer service from South Florida:
- NetJets. The oldest and largest jet membership service in the U.S. is Warren Buffett-owned NetJets, an Art Basel sponsor. It offers both fractional jet ownership and leases. The company does not reveal pricing. Offerings include a 25-hour jet “card,” with starting prices estimated between $165,000 to $200,000. Headquartered in Columbus, Ohio.
- Wheels Up. A Wheels Up Membership starts at $17,500, but you can take advantage of additional savings through their partners such as Costco. After joining, you simply pay as you fly with a fixed hourly rate on its 8-passenger King Air 350i or 8-passenger Citation Excel/XLS.
- XOJET. Membership in California-based XOJET requires a $50,000 deposit, which then pays for flights on any size jet the customer wants. It has a dynamic pricing model, which means hourly rates change depending on demand.
- Sentient Jet. Entry-level memberships start at $131,800 card for 25 hours on a light jet, including taxes. Sentient Jet is headquartered in Quincy, Mass.
- BLADE. The cost of a BLADE one-jet ride between New York City, where the firm is based, or Westchester, N.Y. and Miami on scheduled service starts at $2,250 each way; there is no membership. The cost of seaplane flights between Miami and Palm Beach are $325 each way. For customers who travel often and/or in groups, season passes for bulk seats are offered at a discount.
- JetSmarter. After facing questions about changing terms of service from longtime members, Fort Lauderdale-based JetSmarter now offers both memberships and pay-as-you-go options. Individual memberships have an initiation fee of $3,000 along with the $4,950 annual membership fee
Private aviation airports
Miami International Airport
2100 NW 42nd Ave
Miami, FL 33126
Miami-Opa locka Executive
14201 NW 42 Avenue
Opa-locka, FL 33054
Miami Executive Airport
12800 SW 145th. Ave.
Miami, Fl 33186
Miami Homestead General
28700 SW 217th Ave
Homestead, FL 33030
Fort Lauderdale Executive
6000 NW 21st Ave.
Fort Lauderdale, FL 33309