By Paul Tharp
It’s a wallet-slamming recession for the 1 percenters — and it’s hitting them right in their G5s.
Moguls and wealthy celebrities are seeing the value of their private jets tumble as the regular pool of used jet buyers has dried up, sources tell The Post.
In fact, the value of the trade-in jets has fallen by as much as 50 percent, the sources said.
The superrich regularly shed their posh luxury jets for upgrades every few years, but they are finding out that the old bucket of bolts isn’t worth what they thought it would be.
“Private jets had always held their values better than almost any asset class in the past decade, losing only about 2 percent a year,” said Dan Jennings, CEO of The Private Jet Co., a leading broker in private aviation.
“The bottom has fallen out for pre-owned jets and the bargain rush is on.”
What had been a reliable investment for the superrich — who’d drop $60 million and up for a new jet — has changed drastically.
Not that some of those looking to trade in their wings — which sources said includes Tour de France champ Lance Armstrong, publisher Jann Wenner, and Microsoft co-founder Paul Allen — are cutting back, Jennings said.
The trade-in crowd is hoping buyers from overseas will help pick up the slack.
“Foreign buyers are flocking here and snapping up bargains they never could have afforded just a couple of years ago,” Jennings said.
A sleek Gulfstream 5 — a symbol of success known among owners simply as a G5 — can now be had for as little as $20 million.
For example, billionaire Ron Perelman has put his pampered 1996 G5 on the block for $18.9 million — far less than the $32 million book value it would have enjoyed just two years earlier — even with its Park Avenue-inspired interior.
Perelman isn’t worried about the weaker trade-in price, said friends. He’s taking delivery later this summer on a new $52 million Gulfstream 550.
He already owns a Gulfstream 550 that he bought in 2006.
Demand for new jets is as robust as ever, said Gulfstream CEO Jay Johnson.
The company has a $50 billion backlog of 200 orders for its new models, the 550 and 650, Johnson said. About two dozen will be delivered by the fourth quarter.
The long-range 650 will run you $62 million or more — depending on the gear.
Brokers said most of the foreign buyers seeking used jets are from the so-called BRIC block of developing economies — Brazil, Russia, India and China.
“Their business people need a better way to get around huge areas,” Jennings said.
The private aviation industry projects that foreign buyers will outnumber US buyers this year.
Source: THE NEW YORK POST
Date: July 31, 2012