Beta signs 75-year lease at Burlington airport. But the electric aircraft startup could avoid paying rent for up to 38 years
The electric aviation startup Beta Technologies has signed a 75-year lease at the Burlington International Airport, potentially tying the fast-growing company’s future to Chittenden County. But Beta may avoid paying rent to the city for nearly four decades, under a lease approved unanimously by the Burlington City Council on Monday evening.
Beta is building a 355,000-square-foot facility on the south end of the airport grounds, where the company plans to design and assemble its fully-electric aircraft. Beta is currently testing two prototypes of the battery-powered aircraft. It hopes to receive federal approval for the vehicle within the next few years, and has so far raised over $800 million from investors to meet that goal.
Under the terms of the lease, Beta will receive a credit of up to $11.5 million for making infrastructure improvements at the airport. That credit will be applied to Beta’s rent, effectively eliminating all rent payments for up to 38 years, according to the company’s agreement with the city. That assumes an annual rent increase of 2%, based on the consumer price index. However, Beta’s rent could increase as much as 6% per year under the agreement, depending on the rate of inflation. If Beta stops using the facility for manufacturing or shuts the plant down entirely for more than two years, the rental credit will end and Beta’s annual rent will increase by 10%.
“It’s not that they’re not making rent payments,” said Mayor Miro Weinberger in an interview with Vermont Public. “It’s that they’re making this enormous upfront payment of as much as $11.5 million.”
Weinberger said the company had received cash offers from other states to locate its manufacturing elsewhere, and noted the city will be able to receive market rent for the site if Beta’s plans falter.
“It certainly seems reasonable,” Frank Cioffi, head of the Greater Burlington Industrial Corporation, said of the lease agreement. “The jobs and the investment at the airport, in South Burlington, in the state of Vermont, certainly makes up for any lack of lease payment.”
Beta was founded in 2017 and now has about 300 Vermont employees, with additional operations in Plattsburgh, Montreal and North Carolina. Company leaders have said they intend to hire hundreds more employees to staff their assembly plant at the airport. Gov. Phil Scott has compared Beta’s potential impact on the Vermont economy to that of IBM’s decision to locate a plant in Essex Junction decades ago, which brought thousands of high-tech jobs to the Green Mountain State.
“With this agreement, Beta will launch its production here in Vermont within a new sustainable and responsible green campus here at the airport,” Beta CEO Kyle Clark said in a written statement. He also thanked city leaders for supporting the company.
In a memo to city councilors, Nicolas Longo, the acting director of aviation at the Burlington airport, said the benefits of Beta’s presence in the Burlington area “have been, and will be, substantial — including everything from direct payroll taxes, sales taxes, hotel and restaurant revenues.”
Beta has already invested $15 million in its existing facility on the airport grounds, according to Longo.