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The Honolulu Advertiser
Posted on: Tuesday, July 29, 2008

Well-heeled fly high in private jets

By Rick Daysog
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser

Castle & Cooke's aviation unit opened "fixed based operations" in Honolulu.

Photo courtesy of Castle & Cooke

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In the days leading up to the March 7 grand opening of the new Nordstrom at Ala Moana Center, the department store called in its air force.

Three private jets whisked Nordstrom president Blake Nordstrom and other top execs to Honolulu to cut the ribbon on the new 210,000-square-foot store.

"It was an all-hands-on-deck mentality for us," said Nordstrom spokesman Michael Boyd. "Every store opening is a major event for us."

The Nordstrom executives join an elite group of Fortune 500 corporations, super-wealthy individuals and A-list Hollywood celebrities who travel to Hawai'i on the ultimate status symbol: the private jet.

Records provided to The Advertiser by the state Department of Transportation under Hawai'i's open records law show that the state remains a preferred landing site for Wall Street dealmakers, Hollywood stars and Silicon Valley entrepreneurs.

Kahului and Kona airports are especially popular among the gilded set, the records show.

The peak-season private jet traffic at Kona has become so congested at times that pilots have to drop off passengers at the airport before flying to Hilo to park their aircraft, airport officials said.

JET SETTERS

One repeat visitor to the Big Island was Apple co-founder and Chief Executive Officer Steve Jobs. Jobs' $43.5 million Gulfstream V jet made three trips to Kona during the past 12 months, Transportation Department records show.

Media mogul Oprah Winfrey, who owns several properties on Maui, flew her new Bombardier Global Express XRS from Santa Barbara, Calif., to Kahului Airport last July while singer Jimmy Buffet piloted his Dassault Falcon 900EX jet from Los Angeles to the Valley Isle in September.

Saudi Prince Alwaleed Bin Talal Alsaud listed by Forbes magazine as the 19th-richest man in the world with more than $21 billion in assets flew his custom Boeing 747-400 from Los Angeles to Honolulu last August for a three-day stay.

Executives from Las Vegas casinos Harrah's Entertainment Inc., MGM Mirage and Boyd Gaming Co. also made trips to the Islands last year, while jets owned by Hollywood studio DreamWorks SKG and parent Paramount Pictures made several trips to Kaua'i and Kona.

DreamWorks filmed Ben Stiller's movie "Tropic Thunder" on Kaua'i, while Paramount was on the Big Island to film parts of "Indiana Jones and the Kingdom of the Crystal Skull."

$40 MILLION PRICE TAG

The cost of owning a jet is out of reach even for most movie stars.

Prices for new business jets start at $40 million, and that doesn't include the costs to pilot and maintain the aircraft. A flight between Hawai'i and the West Coast can eat up 2,000 to 3,000 gallons of jet fuel, costing $10,000 or more, aviation industry executives said.

Many of the biggest Hollywood stars fly on corporate jets owned by the big studios when shooting a film in Hawai'i. The majority of actors and celebrities fly here on charters arranged by the studios.

Some of the celebrities and elite athletes such as Tiger Woods and Vijay Singh fly to Hawai'i in Gulfstream jets that they co-own with other investors.

Only a small portion of the jet traffic is locally based.

Unlike the 1980s and 1990s, when companies such as Alexander & Baldwin Inc., First Hawaiian Bank and megaresort developer Christopher Hemmeter owned their own corporate planes, most of Hawai'i's top CEOs fly commercial.

HURT BY FUEL PRICES

David Murdock, Dole Food Co.'s billionaire chairman, and local developer Jay Shidler are among the few exceptions. Transportation Department records show that the two executives made more than a dozen trips between Honolulu, the Neighbor Islands and the Mainland on their Bombardier business jets in the past year.

"These are people with lots of millions of dollars," said Neil Shaw, president and chief operating officer of Elite Aviation Inc., a Van Nuys, Calif.-based company that flies chartered jets for the big studios and other celebrities.

"A normal millionaire can't afford a private jet."

And while private jets are typically used only by the super wealthy, this form of travel is not immune to the same economic forces that are hurting the nation's commercial airline industry.

As aviation fuel prices have more than doubled during the past year and as the U.S. economy has flirted with recession, the traffic levels for chartered jet service which represents a vast majority of noncommercial jet travel nationwide has fallen anywhere between 30 percent and 50 percent this year, said Shaw.

Some airports on the Mainland have seen their overall traffic decline 10 percent to 30 percent, local airport officials said.

FEELING THE EFFECTS

Hawai'i is likely to see some of the fallout, given that it's largely a leisure destination for jets and not a business destination, Shaw said.

Figures provided by the state Transportation Department are already beginning to reflect that trend.

According to the Transportation Department, the number of landings and departures of private jets, corporate aircraft, chartered jet flights and other forms of noncommercial air travel dropped by 4.3 percent in 2007 to 99,322 from the year-earlier's 103,804.

The noncommercial air traffic to Kona was down 3.4 percent while jet landings and departures at Kahului Airport were off by 9.6 percent, according to the DOT. Honolulu Airport's jet traffic was off by 7.9 percent.

The slowdown in noncommercial traffic comes as local airport officials are at the beginning of a $2.3 billion upgrade of the state's aging airport system.

Brian Sekiguchi, deputy director for the state Transportation Department, said the state wants to encourage general aviation, or noncommercial air travel.

The state is planning to expand the general aviation facilities at Kona Airport as part of a 20-year, $80 million overall upgrade of the West Hawai'i airport.

The state has identified 58 acres of vacant land on the south side of the airstrip for the new facilities, which will be built with private money and not with state funds, Sekiguchi said.

One likely bidder: David Murdock.

Last month, Murdock's Castle & Cooke Aviation unit opened new "fixed based operations" at Honolulu Airport to service private jets and personal airplanes. Castle & Cooke, which has similar operations in Van Nuys, Calif., and Everett, Wash., has invested more than $10 million in its Honolulu operations.

"We're very bullish on the state of Hawai'i and the long-term future of the industry," said Tony Marlow, general manager of Castle & Cooke's Honolulu facility.

Reach Rick Daysog at rdaysog@honoluluadvertiser.com.

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