Cape lands aircraft firm

An airplane manufacturing firm established in the wake of a bankruptcy will take flight in Cape Girardeau, city and company officials announced Thursday.

Commander Premier Aircraft Corp. will relocate its airplane manufacturing firm from Bethany, Okla., to the Cape Girardeau Regional Airport. Commander Premier also will establish its sales, parts and service center at the airport.

The company will operate out of the former Renaissance Aircraft hangar. It will lease the 52,000-square-foot building from the city under an agreement finalized at city hall Thursday morning.

Last-minute negotiations between the city and the company delayed the announcement of the deal at an airport news conference for about 30 minutes.

City officials announced the news with Commander executives while standing in the empty hangar as council members, county commissioners and economic development officials looked on.

The company will lease the hangar from the city, but the first six months will be rent free. After that, Commander Premier will pay the city $11,000 a month, gradually escalating to just over $21,000 a month by December 2009, city finance director John Richbourg said.

Commander Premier hopes to begin building airplanes by December. The first planes could come off the assembly line by next summer. Company president Joel Hartstone said the company expects to build 15 planes in 2006 and up to 30 a year after that.

The four-seat, single-engine planes will sell for about $600,000 each.

Hartstone compared the plane to a Mercedes. "We believe it is the finest single-engine plane," he said.

The company expects to employ 45 people the first year and expand to about 100 jobs within three years, said industrial recruiter Mitch Robinson, executive director of the Cape Area Magnet association.

That could generate an economic impact of about $4 million annually for the Cape Girardeau area, Robinson said.

The new manufacturing jobs will start at about $35,000, he said.

Commander Premier hopes to expand to a second hangar after its first year of operation, local officials said. The new hangar would be built by the city and leased to the company, but those details still haven't been finalized.

The company will receive state economic development aid. Over the next five years, it will be able to keep $818,000 in state payroll taxes.

The state also will provide at least $70,000 in job training, Robinson said.

The aviation company was created by 50 owners of Commander airplanes. They acquired the assets of the former manufacturer in June after the original company went bankrupt. The new company had to relocate because it lost its lease on the Oklahoma building where the planes previously had been built.

The original firm filed for bankruptcy in December 2002. No new Commander airplanes have been built since then, officials said.

The new company, Commander Premier Aircraft, paid $1.7 million for the necessary tooling and the federal certificates needed to manufacture the airplanes, according to the trade publication General Aviation News.

The group hired StoneGate Capital Group of Farmington, Conn., to help with the financing and management of the new corporation. StoneGate specializes in business startups and in turning around financially troubled businesses.

Airport was a factor

Cape Girardeau beat out more than 150 other cities to land the business, Mayor Jay Knudtson said.

Commander Premier's Hartstone said the city's well-run airport was a factor in the decision to locate here. "The runways are excellent," he said. "The airport is well-maintained."

The fact the airport is served by a commuter airline was a key factor too, Hartstone said. Airplane buyers typically want to take commercial flights to and from an aviation manufacturing facility, he said.

Claudia Horn, Commander Premier's chief financial officer, said the company wanted to locate its plant in the central United States for the convenience of its customers.

The city had been seeking to fill the spacious hangar for the past 10 months, ever since financially troubled Renaissance Aircraft abandoned plans to build airplanes in Cape Girardeau.

Renaissance's demise left the city with an empty hangar and costly bond payments. The new lease agreement ultimately will eliminate the city's financial burden, officials said.

"We all know we have some history with this particular building," the mayor said.

Knudtson said he looks forward to seeing activity in the hangar. "It looks too sterile. It looks too calm. It looks too clean," he said.

Under the lease arrangement, the company will pay $3.17 million in rent to the city over the next 14 years.

The city will use the money to help pay off $2.6 million in bonds used to finance construction of the hangar. Richbourg said the city expects to retire the bonds by April 2020.

At that point, the company will have the option of entering into three five-year lease renewals, he said. Commander Premier also would have the option of buying the building.

mbliss@semissourian.com

335-6611, extension 123