From time to time, the topic of Private Aviation will come up and often peopel will struggle knowing where to begin. Jared Hasty from Piedmont Jets stops by the podcast today to share why he is so passionate about the industry and how he guides prospective clients through the process of deciding what options are right for their situation. If you have ever considered, buying, leasing, fractional share, jet card etc. listen in for more from a trusted source!
Please check out and subscribe to my Youtube Channel and Newsletter!
JOSH KLOOZ, CFP®, MBA
WEALTH ADVISOR
Phone 281.719.0036
Text 281.699.8691
Fax 281.719.0156
jklooz@carsonwealth.com
1780 Hughes Landing | Suite 570
The Woodlands, TX 77380
Music by bensound.com
From time to time, the topic of Private Aviation will come up and often peopel will struggle knowing where to begin. Jared Hasty from Piedmont Jets stops by the podcast today to share why he is so passionate about the industry and how he guides prospective clients through the process of deciding what options are right for their situation. If you have ever considered, buying, leasing, fractional share, jet card etc. listen in for more from a trusted source!
Please check out and subscribe to my Youtube Channel and Newsletter!
JOSH KLOOZ, CFP®, MBA
WEALTH ADVISOR
Phone 281.719.0036
Text 281.699.8691
Fax 281.719.0156
jklooz@carsonwealth.com
1780 Hughes Landing | Suite 570
The Woodlands, TX 77380
Music by bensound.com
Welcome, and welcome in again to another episode of Wisdom and Wealth. Thank you so much for joining us. From time to time, different clients and prospects have come to us with questions revolving around private aviation and how to navigate that space, and on occasion we have talked through the fractional share market and different private charter options. But we've never invited someone that's actually in the transaction space. And today I've invited Jared Hasty from Piedmont Jets onto the podcast. He's a co-founder of this company and we, coincidentally enough, had the pleasure of getting an MBA together while we were at Atlanta. But, jared, thank you so much for joining us today and I'm excited to learn a little bit more about how you help people in this space. Happy to be here. It's good to see you again. Good to see you as well, and for those listeners that are newer to you, do you just want to give us a brief introduction to yourself personally and we'll dive into the formal conversation.
Jared Hasty:Sure thing. So pilot by heart and nature. I used to fly corporate and charter. I have an ATP single and multi-engine rating with about 5,000 hours and a couple of type ratings and some jets. I then worked into managing airplanes and managed anything from a turboprop up to an international challenger, went back to Georgia Tech and did an MBA with a focus on global business, and that's when I met Josh and moved my way into the aircraft trading world and was mainly on the operations side and then in the sales side. I've been in sales for about seven years now. We co-founded Piedmont Jets about two years ago and then, on the personal side, married to my little Cajun princess, two kids, eight and 10. We live here in Atlanta, travel a lot and big deadhead and outdoorsman how about that?
Josh Klooz:Awesome. Well, I knew aviation was your field back in the day, but I had confessed I had no idea that you were as deep in the industry, not only professionally but also as a. Did it start as a hobby, or was it just an obsession? How did that work out personally?
Jared Hasty:I was midway through undergrad and figured out that I was in college to get trained to have a career, so then decided I wanted to try to get paid to travel and to fly planes. That sounded like a fun one, so I transferred to schools and I ended up doing a business degree in aviation management from Auburn Okay, and all I wanted to do was be an airline pilot. I ended up finding my first job in the corporate world and just never left the corporate world, but that's been my passion ever since I found it. I love it. I fly personally and professionally. We have our own plane and it's a business tool, and almost everybody in our company are seasoned pilots. Most of them have been professional pilots at some point.
Josh Klooz:That is so neat. Well, like I said before, from time to time people will come to us and it is a large financial decision and lifestyle decision that people are making when they enter this space. And so you as a trusted partner, it's a help kind of provide some frameworks. I thought would be very helpful. And so it's starting out. If somebody's looking at the space, would you mind just giving your experience and how you walk clients through buying versus other options that are less permanent?
Jared Hasty:Sure, I spent like the first part of my world and the business world was in the charter world, so I would see people as they took their first flight. And then I had people that were transitioning into owning their own airplanes and now I help on the buying and selling. So we have people come to us daily who are asking that same question Is it right for me to buy, do I charter, do I do fractional? So typically, the conversation we usually start out with well, what's your need? What's your mission? Why are you looking to travel this way? Most of the time it's a business need or a lifestyle need. They need to get to factories that are spread across five states. They're using the airlines or driving and it's taking them. It's just too inefficient, whereas they could hit all three factories or something in a single day and be home at night in their bed with their family if they had a private plane. So we encourage them, if they haven't already, to charter, just dip your toe in kind of check it out.
Jared Hasty:I like giving real estate analogies. I grew up in a family that was involved in real estate a little bit, so I would always hear if you're looking to buy a second home. Well, first go just rent there. Make sure you like it. See how often you go. Don't even think about how much it is. See if you keep going back to the same place.
Jared Hasty:If it makes sense and you keep doing it that way and you can't see life without it, then, yeah, maybe you should think about buying. I can tell you. If you want to look at it from a purely numbers standpoint, the ownership model starts making sense above about 100 to 125 hours. I've run these spreadsheets backwards and forwards six different ways from Sunday a thousand times. Above about 100 hours, 125 hours. You should be looking into financially making that purchase. Now going back to the why some people are doing it for a lifestyle play. Some people are doing it purely from a numbers standpoint. Some people are doing it for depreciation play. The first conversation is always getting to the why and then figuring out which way we need to approach it.
Josh Klooz:So in prepping for this conversation, I came across the Warren Buffett quote that the quickest way to become a millionaire was to start as a billionaire and buy an airline, but he didn't say anything about a private jet. So I think we're in the clear. But you hit on something that I think is key and it's experiential right. Does the experience match up with the benefit that you're getting from it? We're trying to get our time back, which is, for most of us, invaluable right? Especially if you have young kids or you have certain seasons of life. Those certain windows are very precious to us. But you want to make sure that you make a wise financial decision. You talked about some of the tax benefits and the depreciation piece. When do you think that that should enter the equation in somebody's calculus? Because I think sometimes that's where people start and they back their way into justifying the conversation sometimes.
Jared Hasty:That should only enter the conversation when you're talking to. It usually comes up when you're talking to your CFO or your CPA or your wealth manager who is then telling you man, you're chartering a lot. I think it's time to start looking into maybe purchasing and looking into the benefits of it and then if you figure out with an aviation specific legal or tax counsel that it's right for you and that you can garner the depreciation and qualify for it and how you do it, that's when that typically enters. You don't want to make the decision, you don't want to let the tail wag the dog. You don't want to go in saying I need an appreciation play, I'm going to buy a plane, and then you just kind of bulldoze forward, going from there. I don't like approaching it that way.
Josh Klooz:The other thought that occurs to me is the Say, this season of life, we know we're going to be really busy with our business or our family, or we just know that we're going to need a resource In real estate. Hey, I've never talked to anybody who's lost money as long as they had an unlimited hold time Right In this space, in the private aviation space. What are some of the ground rules that you talk through with clients Like, hey, if you're going to own this plane, it needs to. It can't just be for the next year, it can't be just for the next five years. What are some of those left and right limits of like, hey, it makes sense to own this plane for a certain amount of time, or you should just Go from there. If they are entering the conversation with, hey, this is just a season and then we're gonna get rid of it, what are, what are some of the thoughts that come to your, your mind?
Jared Hasty:the thoughts that come to mind, if somebody were to come to me with that, would be Making sure that they are very well educated on what the experience is going to be like owning a plane financially you know there are and and not just financially but time-wise everything else you need to make sure.
Jared Hasty:This is a highly complex machine and it takes a lot of logistics and a lot of moving parts and processes and people to keep it Going and not just going, but going safely and efficiently.
Jared Hasty:So we need to spend a lot of time making sure that this all of those processes and people and the, the structure and the skeleton that is going to support this this thing is going to be starting out on a good foot. So a management company making sure your taxes are set up the correct way legally, the different partnership agreements, the, the operating agreements going down the line, making sure everything is setting up, set up very smoothly so that when you own it, it it's adding to your life, not taking away. Because if you try to do it on your own, you try to wing it, you try to say, well, listen, I manage a ton of properties or I build these complex things in my normal life. This is no big deal. This little aviation can eat your lunch, so you want to make sure they have a Proper expectations on what it's going to be like, and then the team to back it up to make it an efficient fun experience.
Josh Klooz:So you've already hit on, you know this already. But the safety concerns and in just a logistical Considerations, I don't think a lot of people fully understand that they've got an idea, but when you finally experience it it feels different. Can you talk through some of that, that process that you walk clients through? I'm sorry say? What feels different the, the safety concerns and then the logistical concerns like maintenance and things of that nature. Can you walk through just some of the things that you walk people through to make sure that they're ready and equipped?
Jared Hasty:Right, I mean. So aviation is a very it. It's a world that we're all, most people are very foreign to. I mean you are all of a sudden having to let go and trust Whoever that crew is, the processes, the management company, the plane, and take you into a very foreign atmosphere in place. You were going to be going, you know, let's say, 40,000 feet above the earth, going 600 miles an hour, and it's negative 45 degrees outside, and you're trusting literally your whole life to these people in these processes.
Jared Hasty:So you don't want to take it lightly. You want to look at and do it right. You don't want to pinch pennies On certain things in certain places. You don't want to save 10 or 20 thousand dollars here or there on the quality of pilot or the management company, everything. You want to make sure that the management companies, the people, the processes where your plane has maintenance performed, everything is to the quality that You're removing as much of that risk assert as possible. The nice thing about aviation is because it's so complex. There are backups to backups to backups. There is safety nets for almost everything and the safety level and what we do in this industry is safety. It comes first. That's not a cliche, that's not a saying, it Absolutely comes first. These pilots go to simulator based training where they're practicing emergencies, their backup systems to the backup system and and because of that I tell people all the time the the riskiest part of this entire trip was my drive to the airport. Hmm, now.
Josh Klooz:So if, how do you help Clients if they're unsure of where to find the right maintenance programs or if they're unsure of where to find In-source pilots and things of that nature, do you have relationships locally? Or how do you handle that if someone is, you know, trying to figure that all out on their own but they're not quite sure that they've made the right choice in those aspects?
Jared Hasty:Sure, so the way the model, our business model of Piedmont jets is, we're full service concierge. So we are, we will quarter back the whole thing. Okay, you can show up and not even know what a private jet looks like and we can take you from that to have the most beautiful plane and department and processes and everything set up by the end of it and feel good about it, know exactly why and educate you the whole way. So that's our model. We can help locally, internationally, everything on a plane from a three million dollar private, you know, let's say, turbo prop, up to a seventy million dollar Transcontinental. So we, we will quarterback that whole process, everything from finance to legal, to tax, to management, to you name it.
Jared Hasty:The nice thing about you know, like, let's say, my background. I have a very, very background. I can put on a lot of different hats and Approach each one of these different engagements. You know we can talk on one point about management companies and I used to manage planes and I have a lot of relationships there and then we can talk about what's the right plane and we can talk. I can put on my pilot hat. We can talk about aircraft performance and density, altitude, and you know the different, what are flaps and slaps, and you name it and then we can put on the you know the NBA hat and we can talk about the finance side of things and just keep doing that. And then Everywhere we have different team members who specialize in everything in the company to make sure that everything's done to them to the high expectations.
Josh Klooz:Do people ever come to you if they've already made a purchase? They were there in a situation but they say, hey, this isn't working out to you know they're satisfaction. Do they ever come to you and say, hey, audit our systems and our processes? You even do that as well.
Jared Hasty:We do. It's typically to the point where. It's typically to that point where the either they've had poor expectations and they haven't been coached well on the beginning In terms of their broker did not coach them well on setting expectations, what it would be like Time-wise, process-wise, money-wise, to own an airplane. Or Maybe they've inherited the airplane and it's just fallen in their lap. And what do I do with this? So we come in and we'll audit the situation and Figure out what. Where is the disconnect? Is that that gap worth bridging? And can we fix this for you or straighten it out? Or To you to trade the plane and move on and and and. Then, if that's the case, if most of the time you still need lift some way, you've got used to flying this way You're not going back to to driving and flying the airline. So then it's now. Let us help you sell the aircraft and then let's help you get set up in the right Solution for you, whether it be charter or fractional or partnership or so on, so forth.
Josh Klooz:I Think we've danced around this one back and forth a time or two, but we've the finances of owning the platform. I'd be curious from just to hear your perspective and your experience. You have the finer points of paying cash versus financing what. What are your thoughts? And that's obviously a lot of question in the current interest rate environment, but I get it.
Jared Hasty:It's a loaded question. I mean that's going to depend on, honestly, a lot of. You know what is, what is your, what is your wealth advisor, what is your CFO, what is your, what is your general approach on finances and how do you do things? I talked to clients all the time who say I do not like debt, I'm paying cash for everything, I don't care what, what the interest rates are. And Then I have other clients who play their arbitrage and say you know, at 6% loan on this plane, my, my business, I can make way more than that, so I'm going to play that game all day long. I'll take as much money as they can give me. They could pack cash for the plane easily.
Jared Hasty:So that's more of a style thing in a, in a. I guess a strategy and approach, depending on what you want to do, the, the typical structure you know this is really high level speaking on in terms of financing just to give you an idea would be Call it between a 10 and 15 year amortization With a five year balloon Rates. You know depends on the, the plane and the credit profile and everything else in terms of your rates. But you know, let's just call it anywhere these days from between six and eight percent.
Josh Klooz:Got it Now. What are some of the common misunderstandings, misconceptions, even maybe mistakes, that you've seen out there? That if somebody's listening to this, they should definitely give you a call?
Jared Hasty:Right. I would say the biggest mistakes I wish I could just tell everybody this that's even thinking about going in this world is find aviation specific guidance that feels good to you, that you know that they've got your best interest at heart and that you're getting good guidance. Because this is the assets mimic the transactions of another asset, but it's not. It's so highly specialized and so you can really catch yourself in a bad position if you don't have the right guidance. So you want to make sure and get it set up the right way, the right management company, the right tax guidance, the right financing, a broker you want to have a good broker that has your best interest at heart.
Jared Hasty:When I hear people saying they're just going to buy it on their own, which I hear too much, I just say guys, man, listen, please don't do that. Even if they don't use us, let me help you find somebody. If we're not the right fit, let me help you find somebody that is the right fit. If each one of those people that are helping you are not saving you as much or multiples of whatever they're costing you, then they're not worth their weight and salt. So I would just say get good guidance. You need it in this world. It's a very foreign world. And then the other thing is don't scam, don't cut corners in aviation. Cut corners on something else, don't cut it in aviation.
Josh Klooz:Now, if somebody's in here, this may be a little bit niche, but if somebody's inherited a platform and has no idea what you know, hey, I've flown on a plane, but now I own it. How have you seen that work? Or say, even somebody corporately is now stepping into a role where they're now in charge of managing the company asset. Any words of wisdom for those two particular individuals?
Jared Hasty:I would just say find whoever your main point of contact would be with that flight department and you need to quickly get to lay the land and audit the flight department or how that plane is being handled and make sure it's up to your levels. You're inheriting something that's a highly complex piece of machinery and the support team that's around it, so I'd want to understand it pretty quickly. I wouldn't want to just jump on the plane just inherited, with whoever the crew is or whoever the management company is, and just start, you know, blasting off. I'd want to say, hey, let's get together. I need a quick meeting. I want to know who all the players are. I want to know give me the budget for the plane for the year.
Jared Hasty:How has it been handled the past? Where are we getting the work done? What's the safety look like? I would get to lay the land quickly and get your point of contact and then, if you have any questions, you know you can reach out to a specialist in the area and say you know, I'm curious, what do you think about this department? I'm hearing this is the way it's always been done. Is that normal? What do you think? Can you just help me from an outsider's perspective?
Josh Klooz:Yeah, the last thought that kind of comes to mind is say that it is one step below full utilization. But should you charter out your plane for those times that you're not using it? I think the Airbnb inclination is alive and well in many areas. What are your thoughts on that? In the private space?
Jared Hasty:That's a great question. I come across this more often than not. I would say it depends on you. Again, it depends on your preference. Again, it's like real estate. If you have a second home at the beach or in the mountains or let's say, can you go to that home if you want to know that you're the only person whose head's going to be laying in that bed and those are your clothes in the closet and nobody else is using your silverware, then no, I would not charter it out at all. If you say, when I'm not here, I hate for it to just sit here not doing anything, just the thought of it doing that. Let's say, this house or this plane needs to be exercised as systems. These systems, like boats or houses, they need to be exercised.
Jared Hasty:Planes do not sit well If you're only flying the plane let's say 50, 100 hours a year, and there's plenty of time that you're not flying the plane it can actually be better for your plane to fly a little bit more and stay exercised. There's a delicate balance there. My personal preference and this is just a preference is I think a plane shouldn't fly less than about 100 hours a year. I think it should fly more than that. Then after that, I think a happy medium if you are going to introduce charter and you're okay with it is you want to put on enough that it's worth your while in the hassle but at the same time you don't want to overload it on utilization and be using it more than the industry average to a point where you're depreciating the value of that plane, is depreciating faster than the rest of the market because it's got more hours than what is typically the average. Then on top of that you're increasing the wear and tear and you're increasing, you're shortening the maintenance time spans because you're flying it more. All of those things need to be taken into account when it is flying that much. Typically a good balance to me.
Jared Hasty:If somebody were to come to me and say, hey, listen, I'm going to fly this plane 100 to 150 hours a year and I'm going to charter it 250 to 350 hours a year, I'd say, man, I think that's perfect. You're about 400 or 500 hours, maybe 600 hours a year utilization. That's a good bit, but it's not too much. You get going over that then. That's a little bit too much for me. Under than that, I think you're doing fine. You're helping really offset your fixed costs. It's making you feel good that you're helping your budget a little bit. At the same time, it's keeping your plane exercised. I would just make sure, if you do it again, you really vet the company that's chartering your plane and managing your plane to make sure it's a good partner and they have your same standards at art, that they're not cutting corners, that they're not chartering it out to people who are just abusing your plane or so on and so forth.
Josh Klooz:Got it Jared. Thank you so much for sharing your time with us today. Before we sign off, two last questions. Are there any other topics or thoughts that you have that we haven't gotten to? Lastly, how do you prefer the people getting contact with you and the organization?
Jared Hasty:Sure Any other thoughts. Man got me on the spot here. I would say I don't think enough people know about the depreciation play right now. A lot of people do. It's driven a lot of people into our industry. Not everybody qualifies, but I would say by and large, most people do. So that might be a plague. You should look into something like that. And then the other would be just try it out, try your industry out.
Jared Hasty:If you're thinking about doing it charter plane, take it on your next business trip. I think it would blow your mind how much it optimizes your life. I love airplanes, I love flying, but that's not my driving passion on what we do. It's showing people just how optimized life can be when you travel this way. So it's just so neat. I wish I could share it with everybody. I think everybody should try it out if you have the means to be able to do it. And then how to get in touch with us PiedmontJetscom I'm sure you can reach out to Josh and he can forward my info on and love to hear from everybody. We're on LinkedIn, instagram, facebook, all those different places.
Josh Klooz:Excellent, jared, thank you again for your time. I wish you, your family and organization, nothing but truth, beauty and goodness on the road ahead.
Jared Hasty:Thanks, brother, it's good to see you again. Happy to do it.