FBO (Mercury Air) doubling hanger rent to run off GA at BHM.......is this legal?

In article , "Mike Rapoport"
wrote:

If airports were managed properly, they would charge market rent for
hangars
and other space.

how is market rent set for a product/service whose supply is
restricted?

By supply and demand

It's not free supply and demand when the supply is artificially
restricted. Thus the concept of "market rent" doesn't make sense.
In the true supply and demand scenario, increased demand would
increase supply. That isn't possible (a fact you recognize below).

They would be profitable

why is profitability assured?

Because hangers won't be built unless the rents justify the cost.

that won't assure profitability.

, and more hangars and office space would be built,

I'd love to see you try to survive a meeting where you propose
this to the anti-airport NIMBY goons around KBED.

This certainly restricts supply and leads to higher prices but that is
just a fact of life.

that's a cop-out

--
Bob Noel

"Bob Noel" wrote in message
...
In article , "Mike Rapoport"
wrote:

If airports were managed properly, they would charge market rent for
hangars
and other space.

how is market rent set for a product/service whose supply is
restricted?

By supply and demand

It's not free supply and demand when the supply is artificially
restricted. Thus the concept of "market rent" doesn't make sense.
In the true supply and demand scenario, increased demand would
increase supply. That isn't possible (a fact you recognize below).

But virtually every "good" is restricted in supply to some degree. The
rental costs for hangars resembles the way rental costs for apartments
works; both have limits imposed by limited availability of space *where it
is most desired*. There are plenty of vacant and inexpensive apartments and
also hangars, just not where they are most desired. Rental costs will
always be higher in desireable locations. Location, location, location.
Any time there have been rent controls it has resulted in problems. It's a
nice short term gain for the renter but bad for the landlord and bad for
everyone in the long term as there is no capital for capital improvements.
Remember the rent controls in Cambridge? How about in New York City that
had landlords abandoning buildings by the dozens? Has rent control ever had
good results for an area?

Peter

"Bob Noel" wrote in message
...
In article , "Mike Rapoport"
wrote:

If airports were managed properly, they would charge market rent for
hangars
and other space.

how is market rent set for a product/service whose supply is
restricted?

By supply and demand

It's not free supply and demand when the supply is artificially
restricted. Thus the concept of "market rent" doesn't make sense.
In the true supply and demand scenario, increased demand would
increase supply. That isn't possible (a fact you recognize below).

What would you do with real estate in general? Supply is artificially
restricted because there are parks and other open space. There are
undoubtedly people who say the the price of housing is too high because the
supply of land is artificially restricted by airports.

Mike
MU-2

--
Bob Noel

In article , "Mike Rapoport"
wrote:

It's not free supply and demand when the supply is artificially
restricted. Thus the concept of "market rent" doesn't make sense.
In the true supply and demand scenario, increased demand would
increase supply. That isn't possible (a fact you recognize below).

What would you do with real estate in general? Supply is artificially
restricted because there are parks and other open space. There are
undoubtedly people who say the the price of housing is too high because
the
supply of land is artificially restricted by airports.

well, if we want to be ridiculous, we could claim that all land use
is restricted because the earth is limited in size...

What percentage of buildable land (for homes) is held in parks and
open space?

What percentage of buildable land (for hangars) is held hostage
by airport "managers" or by anti-airport NIMBY goons?

--
Bob Noel

I agree that it not a completly free market. To be completely free there
need to be an infinate number of buyers and sellers.. However the supply is
clearly limited (based on what the community wants) and the price should be
left to market dynamics IMHO.

Personally I would suggest to anyone living in MA that they move if flying
is an important part of their life.

Mike
MU-2


"Bob Noel" wrote in message
...
In article , "Mike Rapoport"
wrote:

It's not free supply and demand when the supply is artificially
restricted. Thus the concept of "market rent" doesn't make sense.
In the true supply and demand scenario, increased demand would
increase supply. That isn't possible (a fact you recognize below).

What would you do with real estate in general? Supply is artificially
restricted because there are parks and other open space. There are
undoubtedly people who say the the price of housing is too high because
the
supply of land is artificially restricted by airports.

well, if we want to be ridiculous, we could claim that all land use
is restricted because the earth is limited in size...

What percentage of buildable land (for homes) is held in parks and
open space?

What percentage of buildable land (for hangars) is held hostage
by airport "managers" or by anti-airport NIMBY goons?

--
Bob Noel

Unfortunately, my wife is at least as important part of my life as is flying, so
moving out of the Northeast is not an option (besides, the location needed for
my line of work, high tech electronics, also dictates locating in an area that
is just as restrictive. The infamous Reid-Hillview thing comes to mind). My
complaint is that hangars in this neck of the woods are difficult to obtain at
any price, and hangar rents for an unheated group hangar if you can get in one
are rivaling apartment rents. Several of the airports here have ample land to
erect hangars (Quonset Point, Providence), but the state is not permitting it.

Mike Rapoport wrote:

I agree that it not a completly free market. To be completely free there
need to be an infinate number of buyers and sellers.. However the supply is
clearly limited (based on what the community wants) and the price should be
left to market dynamics IMHO.

Personally I would suggest to anyone living in MA that they move if flying
is an important part of their life.

Mike
MU-2

"Bob Noel" wrote in message
...
In article , "Mike Rapoport"
wrote:

It's not free supply and demand when the supply is artificially
restricted. Thus the concept of "market rent" doesn't make sense.
In the true supply and demand scenario, increased demand would
increase supply. That isn't possible (a fact you recognize below).

What would you do with real estate in general? Supply is artificially
restricted because there are parks and other open space. There are
undoubtedly people who say the the price of housing is too high because
the
supply of land is artificially restricted by airports.

well, if we want to be ridiculous, we could claim that all land use
is restricted because the earth is limited in size...

What percentage of buildable land (for homes) is held in parks and
open space?

What percentage of buildable land (for hangars) is held hostage
by airport "managers" or by anti-airport NIMBY goons?

--
Bob Noel

--
--Ray Andraka, P.E.
President, the Andraka Consulting Group, Inc.
401/884-7930 Fax 401/884-7950
email
http://www.andraka.com

"They that give up essential liberty to obtain a little
temporary safety deserve neither liberty nor safety."
-Benjamin Franklin, 1759

"Mike Rapoport" wrote in message
...
I agree that it not a completly free market. To be completely free there
need to be an infinate number of buyers and sellers.

That is NOT what defines a "Free Market". A free market is defined as the
parties have full freedom to contract/trade for goods and services. It has
nothing to do with the number of participants (only two or more per
transaction) or the limits of the knowledge or intelligence...only that the
trade is entered into freely and willingly.

However the supply is
clearly limited (based on what the community wants)

That's a form of socialism.

and the price should be
left to market dynamics IMHO.

That's a "market" system, but not necessarily a "free market".

Personally I would suggest to anyone living in MA that they move if flying
is an important part of their life.

I would suggest moving from MA in ANY case. :~)


Mike
MU-2

Tom

"Tom S." wrote in message
...

"Mike Rapoport" wrote in message
...
I agree that it not a completly free market. To be completely free
there
need to be an infinate number of buyers and sellers.

That is NOT what defines a "Free Market". A free market is defined as the
parties have full freedom to contract/trade for goods and services. It has
nothing to do with the number of participants (only two or more per
transaction) or the limits of the knowledge or intelligence...only that
the
trade is entered into freely and willingly.


Yes, that is one of the characteristics of a perfect free market. There
needs to be enough buyers and sellers so that no one individual buyer of
seller can influance the market.


However the supply is
clearly limited (based on what the community wants)

That's a form of socialism.


Actually it is democracy..


and the price should be
left to market dynamics IMHO.

That's a "market" system, but not necessarily a "free market".


True

Personally I would suggest to anyone living in MA that they move if
flying
is an important part of their life.

I would suggest moving from MA in ANY case. :~)


The striped bass fishing can be pretty good.



Mike
MU-2

Tom


Mike
MU-2