New FBO on the TPA Block

The owner of the Tampa International Jet Center, Mike Azzarelli, had to convince Tampa International Airport that the airport could support a second business aviation-oriented fixed base operation.

Since winning the FBO bid, the Tampa International Jet Center has invested more than $10 million, with a $1.7 million expansion underway. The 20-year lease (with no options) encompasses some 14 acres. TIJA employs 25 full-time employees and two companies operating as subtenants, aircraft management firm Southern Air Systems and aircraft sales and charter firm Air Logic Solutions. The FBO has 40,000 gallons of jet fuel storage and 10,000 gallons of avgas, with capacity for another 20,000 gallons of jet-A.

Ironically, says Botana, the FBO today has very good relations with its landlord. “I think they are ultimately very happy with what we’ve built here,” he says. “I think they’re pretty proud of what it ended up being.”

He praises the airport administration, calling director Louis Miller “a heck of an airport administrator,” and citing the airport’s continued focus on controlling costs to tenants. “In his tenure here,” says Botana of Miller, “the cost per passenger to airlines has dropped between a dollar and a dollar and a half. That’s where their focus is placed.”

Regarding the business of operating an FBO at TPA, Botana says, “Typically, FBOs pay a percentage of gross. One of the things they do here, which I found to be a pleasant surprise, is they actually let us amortize our investment over the lease term.

“We pay the [five cents per gallon] fuel flowage fee, but we get to take a credit against any other percentages that we might owe for that amortization cost. Since it’s going to end up being theirs [via the reversion clause], they let you take the credit.

“We pay a square footage fee for the developed land, because they did all the ramps and parking lots for us; it’s 52 cents. For this kind of airport, that’s probably reasonable.”

Critical to the FBO’s initial success beginning in October, 2004, says Botana, was getting several key clients on board before the doors opened. “We sold some 50-60,000 gallons of fuel the first month because we had some tenants,” explains Botana. “Of course, we didn’t do much transient business at that point.”

Since that time, the focus has been on marketing, he says, and with being able to expand to meet demand, thus the current expansion. “Mike felt strongly that the sooner we got the other building built, even though we had to take some additional debt service in the short term, that we could take advantage of an opportunity.”

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