William Long didn’t start out to offer financing for ground support equipment, but since 2011 he’s building a global lessor specializing in what he calls “cradle-to-grave” asset management and financial services for the aviation industry.
“The primary business of a ground handling company, airline and cargo carrier is to move and fly people, baggage and cargo around, and not be an asset manager,” says Long, senior vice president, Somerset GSE Finance, Vernon, NJ. “That’s the role we play.”
In short order, Somerset GSE Finance has developed a wide array of asset management and financial services that as Long puts it, “specifically target synergistic vertical services all tied to GSE capex and service.” In other words, if a customer needs to rent, lease, trade-in, refurbish or dispose of excess GSE, Somerset has a solution to make it happen.
About three years ago, Long, a veteran leasing professional with three decades of leasing and finance experience, joined Somerset Capital Group, Ltd., Milford, CT, that’s been offering leasing and customized financial solutions to American corporations since 1984.
“I joined Somerset to grow our direct origination efforts and establish relationships with larger clients,” Long explains. One such client he’d worked with prior to joining Somerset was with one of the major ground handling companies.
“We did deal No. 1,” Long says. “We did deal No. 2. We did deal No. 3. At that point I began to realize that the GSE market presented a much larger business opportunity for Somerset.”
Long prepared his business plan outlining the GSE market opportunity and his vision to create a global lessor, asset manager and financial services provider for GSE.
“What would set this company apart would be to create a company providing a wide array of services that go way beyond traditional vanilla lease financing of GSE,” he explains.
With that vision, he identified rentals, lease, buy/sell, trade-in and refurbishment services as the targeted areas of focus.
Long got the green light from Somerset Senior Management in late 2010 and established Somerset GSE Finance in January 2011. Long also recruited Jerry Crump to join Somerset as vice president for new business development. Crump brought 14 years of commercial and military GSE experience, as well as airport and airline operations background.
“Jerry is a GSE guy,” Long says. “I’m a finance guy. Our skill sets are very complimentary. Jerry has been a big help to me.”
Crump calls his time at Somerset exciting. “One way we add value is because we are able to provide a wide range of equipment options to our clients who may not have a huge support staff,” he adds. “So we can help them in evaluation and selection of their equipment. We are manufacturer neutral and have relationships with most of the GSE vendors.”
Rentals and lease deals are the backbone of Somerset’s business.
“Normally, we first establish a relationship,” Long explains. “We’re looking to understand the client’s business and equipment needs and then suggest a comprehensive plan that normally starts with a rental and/or lease. Sometimes a rental turns into a longer term lease. We recently closed a deal with a major airline for air conditioning units. It started as a short-term rental and ended up as a three-year lease. We try to be very flexible and meet our clients’ needs. Our present client base includes a nice mix of relationships with ground handlers, airlines, cargo carriers and FBOs both domestic and abroad and it is growing every day.”
One early deal was to provide a $1 million lease line to a Detroit-based FBO, Metro Flight Services. Lee Lancaster, vice president and general manager, needed GSE to support a new contract to handle cargo for a global airline.
“We didn’t have any GSE other than fuel trucks and forklifts,” he says. Lancaster knew what type of equipment he needed, but he also needed a creative financial solution to work within his cargo service.
“It’s simple,” Lancaster adds. “I have a pie that can only be cut so many ways. Our FBO, Somerset, the OEM and the airline all needed to figure out a deal that was realistic.”
That’s what Lancaster says he received for the equipment financing which enabled Metro to acquire a new main deck loader, wide-body pushback and dollies.
Deal further expands Somerset’s capabilities to service its clients with short-term rentals of new and used GSE