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His Private Sky
Entrepreneurs by Jean Gruss | Editor/Lee-Collier
Imagine buying a corporate jet and the first maintenance bill you get is for $250,000.
Entrepreneur Vincent Wolanin had that unpleasant experience shortly after he purchased his first corporate jet in 1998, a Gulfstream GII-B.
But just as the auto repair shop is the most lucrative part of a car dealership, Wolanin quickly realized there was money to be made doing the same thing with jets. And unlike cars, the government requires aircraft undergo regular maintenance, virtually ensuring a steady stream of business.
Without any prior experience in the jet-maintenance business, Wolanin started PrivateSky Aviation Services at Southwest Florida International Airport near Fort Myers. It is now the only independent maintenance and repair facility in the world that works exclusively on Gulfstream jets, he says.
Wolanin has a knack for building companies. Besides PrivateSky, the Sanibel Island resident controls a dozen companies involved in businesses ranging from real estate development to building materials under the Wolanin Cos. umbrella. Among other deals, he's developing a $190 million residential and retail development project off Summerlin Road in Fort Myers with partner Engle Homes.
Wolanin usually shuns publicity, except when it comes to promoting his 15-year-old daughter's budding pop-music career or when he sponsors charitable events to benefit children's charities. At social gatherings, he says, he dreads the inevitable question of what he does for a living. "I tell them I'm an investor and that pretty much ends it right there," he says. If an inquiring person wants to know more, he tells them to go look at his Web site, Wolanin.com. "It's all there," he says, with a shrug and a wave of the hand.
Luring top technicians
Wolanin's strategy for building PrivateSky was to hire top mechanics and technicians from the corporate-jet manufacturer itself. "A lot of my guys built these planes," Wolanin says.
A key hire was Royce Stevens, who headed Gulfstream's technical crew that advised customers how to buy the right plane. "You hire staff who know customers," Wolanin says. "Because I have an airplane, I know others who have them too," he adds. Stevens advised Wolanin on the purchase of his jet, and the two became friends. Stevens is now a director on PrivateSky's board and the company's general manager.
Wolanin says employees followed Stevens when he joined PrivateSky. "People came here because they love airplanes," he says.
Gulfstream currently dominates the maintenance and repair business for its jets, with 70% market share for the maintenance of 1,500 Gulfstream aircraft that are flying today, according to company officials. Gulfstream parent General Dynamics reported that its private-aircraft maintenance services had $484 million in sales in 2005, with most of those generated by maintenance of Gulfstream jets.
Gulfstream guards its maintenance and service business closely and even competes with its only "authorized" service center, privately held Pentastar Aviation based in Waterford, Mich. Pentastar, which started as the corporate flight department for automaker Chrysler, became an authorized service center when Chrysler bought Gulfstream in 1985. It retained that designation when the automaker sold Gulfstream to buyout firm Forstmann Little in 1990. "It's fair to say that Gulfstream and Pentastar compete to capture scheduled maintenance work," says Michael Baker, Pentastar's vice president of maintenance and avionics.
After talking to other Gulfstream owners, Wolanin says, focus on quality work rather than beating the competition with lower prices would be the cornerstone of the business. Airplane jobs run from $20,000 to $2 million, depending on what needs to be maintained or repaired.
To maintain quality, PrivateSky won't work on any other type of jet than Gulfstream. Wolanin says working on planes made by other manufacturers becomes a burden for technicians to manage all of the different systems of the aircraft.
Wolanin closely guards financial details of his company, but a recent audit by Lee County says PrivateSky reported 2004 revenues of $10.2 million. Wolanin says his company is growing revenues at 20% a year and expects the same rate of growth in the years ahead.
PrivateSky has more than 50 employees, though Wolanin declines to be more specific. At any given time, PrivateSky technicians work on six to 12 planes in a massive 100,000-square-foot facility alongside the airfield.
Customers include celebrities, Fortune 500 and fractional jet-ownership companies. Wolanin won't say who they are for obvious reasons of privacy, but he notes that about 20% to 30% of his customers come from overseas. "Half my customers are billionaires," he adds.
Breaking into aviation
Wolanin didn't start PrivateSky from scratch. He acquired a company called Jet South in 1999, which sells fuel and handles departures and arrivals for corporate jets at Southwest Florida International Airport. "It became very profitable when we acquired it," Wolanin says.
What's more, Wolanin inked a five-year deal in 2002 with ExxonMobil Aviation to be part of its Avitat network, which spurred him to expand his maintenance and repair operation. The Avitat FBO network sells branded Exxon fuel and provides a range of concierge services to pilots and passengers. Private Sky's airside facility includes a conference room, concierge services and catering. The lounge features plush seats with a stunning view of the airfield.
Because he had no track record in maintenance and repair, Wolanin says he had to fund the growth himself. "You've got to spend a lot of money up front," he says. "I went out and bought the stuff." Although he declines to say how much money he spent, he estimates starting an operation like PrivateSky today would probably take $40 million to $50 million.
Trained as a textile engineer, Wolanin says he understood the technical jargon that's essential to the business. He says PrivateSky now has nearly 6,500 customers with the FBO and maintenance operations combined.
Wolanin says PrivateSky has plenty of room to grow. In addition to the 100,000-square-foot facility, he's got a 30-acre lease with 1 million square feet of ramp space along the airfield.
PrivateSky's biggest impediment to growth is not anywhere near the airport, however. "Our biggest problem is the lack of affordable housing," he says. "That's our single-biggest constraint."
Reasonably priced housing is crucial because Wolanin depends on recruiting highly specialized technicians from outside Fort Myers. The median price for an existing single-family home in the Fort Myers-Cape Coral area was $279,900 in February, a 22% increase over the same month a year ago, according to the Florida Association of Realtors.
Wolanin says his employees have also been distracted by a recent county audit that says his company has not provided auditors with enough documentation so they can verify what his company owes the Lee County Port Authority, which runs Southwest Florida International Airport.
"We don't owe any money," Wolanin says. "They may owe us a refund. We may have overpaid."
Wolanin questions why the county would take such action at a time when economic development officials are trying to attract similar operations to Lee County's airport.
"They should be nice to me," he says. "The more successful you are, the nicer you have to be."
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