Airport commissioners ask attorneys to narrow six‑month "redemption" cure period in Capital Flight ground lease

Chair Lurman said the commission would focus on a few outstanding items in Capital Flight’s proposed ground lease and asked city counsel to explain the implications of a contested cure period.

City attorney Matt Fleming told commissioners the lease’s defaults and remedies section would, as currently drafted, add “an additional six‑month period” after a default during which the lessee or its lender could try to sell the hangar, find a substitute operator or otherwise cure defects. Fleming said that language raises policy tradeoffs because it lengthens cure timeframes that elsewhere in the lease are much shorter.

Commissioners concentrated on whether to accept that extended redemption window. Jeff Barton, representing the development side, and Capital Flight representative Matt Hopel argued lenders and long‑term tenants commonly expect protections when they invest substantial sums; Barton drew parallels to mortgage redemption practices and said the period gives lenders and investors time to avoid losing a multi‑million‑dollar investment. Hopel told the commission, “So the answer is yes. You would you would prepay substantially all or all of the six months rent ahead of time to get that six‑month window.”

Several commissioners pushed back on allowing an unqualified six‑month cure. Commissioner Schwarz and others suggested compromise options: shorten the redemption window, limit it to certain types of defaults, require rent to continue to accrue and be payable by any successor tenant, or allow prepayment as Hopel offered. Staff and counsel recommended carving out some defaults (for example, those that threaten airport operations or safety) from the extended cure or creating operational carveouts so the airport would not be left without rent or operating services for months.

The commission also discussed tying the ground lease to a SASO (aeronautical service provider) or FBO agreement that would be specific to the new building and define permitted uses, public‑facing obligations (events/viewing areas) and service requirements. Commissioners noted the airport master plan already places constraints on permitted uses for that parcel and that a separate SASO agreement could make enforcement and transitions clearer.

Other operational details raised included signage (how prominent signage would be, and whether it should reflect the city’s character), ramp and apron use (whether the hangar would appropriate common‑use ramp space), and how to set a market‑based ground rent (commissioners asked staff to explore third‑party valuations and comparable ground leases). Several commissioners requested that engineer Greg Stern and BOA/FAA staff confirm whether a proposed viewing/park area or any ramp reconfiguration would conflict with runway protection or aircraft movement zones.

After discussion, the commission voted to direct the city attorney and staff to continue negotiations with Capital Flight’s counsel to return with narrower language and proposals addressing (1) signage review and process, (2) a recommended lease rate or valuation approach, and (3) aircraft movement/ramp impacts (including any leased ramp area). Chair Lurman said the packet footprint and preliminary plans would remain on file and the parties should return with clarified exhibits and draft SASO/FBO language before the commission makes a final recommendation to the common council.

What’s next: Staff and the city attorney will draft compromise language and layout options, seek BOA/FAA confirmation where needed, and return to the commission with proposed revisions and supporting diagrams. The commission’s recommendation will then go to the common council for final decision.