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HeliValue$, Inc., is proud to reveal the election of its Chairman, Sharon Desfor, to the College of Fellows of the American Society of Appraisers.
The ASA College of Fellows is comprised of Accredited Senior Appraisers who have been recognized by their peers for their contributions to ASA and the appraisal profession. These members are conferred the designation of Fellow (FASA) - the highest honor ASA bestows. ASA’s International President, David Crick, told her, “Your commitment to excellence in your practice and in every task you have undertaken on behalf of the Society has contributed to the advancement of the valuation profession in the minds of those who use, practice and regulate appraisal services.”
Sharon reacted to the honor with a (slightly immodest) amount of pride, but also quite a lot of wonder. “I’m not really sure what I did to earn such a tribute. I’ll just have to do my best to continue to deserve it.”
Sharon previously served ASA as a past president and on many committees. She also spent a decade or so on committees for the Helicopter Association International, and on the Board of the Helicopter Foundation International.
HeliValue$, Inc., is the world’s most trusted helicopter appraisal firm, and publisher of The Official Helicopter Blue Book®, the accepted standard for helicopter resale pricing information.
For further information, contact HeliValue$’ Chairman, Sharon Desfor, at [email protected].
As with most appraisers, Sharon Desfor, owner, HeliValue$ tripped and fell into the role. “Consider this: if every parent were to ask their children what they want to be when they grow up, how many children would answer, ‘I want to appraise helicopters?’ None, that’s how many. Not one,” she says. Desfor began back in 1983 at The Official Helicopter Blue Book. It was there that Desfor met her husband, Barry. “He got me interested in ‘Why’.
Why is this helicopter worth more than that one? Why does the industry prefer this model over its competitors?”
With a love of maths and logic, Desfor started trying to quantify the price delta against differences in the specifications, component times, installed mission equipment, the maintenance programmes or even the reseller, in some cases. “I started looking for the reasons behind the volatility in helicopter values. At some point, I realised to my surprise that this was much more interesting than figuring out how to reinstall the operating system into the idiotic computer one more time.”
Long-established helicopter appraisers HeliValue$ has used the opportunity of lockdown, and have pivoted their work to appraise helicopters remotely. From a recent Helicopter Investor town hall webinar where both President Jason Kmiecik and Owner Sharon Desfor spoke, it is clear that the company is leading the way in adapting to the situation.
After an initial few weeks of hiatus as the aviation finance industry responded to the sudden stoppage, HeliValue$ soon found their traditional customer base needing appraisal work done, and pivoted their offering to achieve this. Having previously sent an engineer onsite to perform a physical inspection of a helicopter, the work is now entirely remote – with the obvious savings to the customer (typically a bank, lessor, financier or insurer) not having to pick up the air fares or hotel expenses of going on site. The aim is still to verify the physical state and maintenance records and provide a valuation report, but the removal of the travel element means that the process is completed quicker than before.
Residual Values in Helicopter Leasing
By Sharon Desfor, ASA, HeliValue$, Inc.
There are two types of residual value analyses, and they do not comfortably co-exist. One type calculates usage directly on an annual dollar-per-flight hour basis, assuming a constant market, with no past or future inflation taken into account.
The second type calculates current versus low markets, accounting for past and optionally future inflation, and assuming the helicopter remains in one component status or possibly moves from one component status to another lesser status (for instance from New to Mid Time) over the term of the lease. This is the type we will addressing here.
Useful Definitions:
Replacement Cost New: Either the OEM’s current new price, or the historical cost of the most recent production year of the asset trended for inflation.
Physical Deterioration (physical depreciation): Loss in value due to consumption of an asset’s life. Maybe be “curable” or “incurable.” Curable deterioration is characterized by the economic feasibility of repair. Incurable deterioration is characterized by the economic infeasibility of repair.
Functional obsolescence (functional or technological depreciation): Loss in value due to factors inherent in the asset itself when compared to its current modern replacement.
Economic obsolescence (economic or market depreciation): Loss in value due to factors external to the subject asset. In its simplest form, it’s the difference between the depreciated Replacement Cost New and the observed market price for a comparable machine.
Fair Market Value (FMV): is an opinion expressed in terms of money, at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts, as of a specific date.
Orderly Liquidation Value (OLV): is an opinion of the gross amount, expressed in terms of money, that typically could be realized from a liquidation sale, given a reasonable period of time to find a purchaser (or purchasers), with the seller being compelled to sell on an as-is, where-is basis, as of a specific date.
Are you considering a purchase? Need to establish a competitive asking price? Considering pre-lease commitments? Are you performing an internal company evaluation? Do you perform your own appraisals and require a more in-depth approach or alternative to a Blue Book page? HeliCalc® is the perfect solution for customers with helicopter operations knowledge. With HeliCalc® you will enter data into the program using your helicopter's component report and installed equipment list. HeliCalc® will also account for hourly maintenance programs, the condition of the paint/window and glass/upholstery and flooring/interior plastic. The program will calculate values based on the average weighted use of your components, the installed equipment, and condition. HeliCalc® will then generate a report and calculations that display your value results. Each report is capable of providing the Fair Market Value (FMV), Orderly Liquidation Value (OLV), and Net Orderly Liquidation Value (NOLV) based on maintenance adjusted, 0% (full-life) and 50% (half-life) component status. Customers will have access to value results using HeliCalc® 24/7.
HeliCalc® is based on HeliValue$, Inc. forty years of collected data and proprietary algorithms. Couple this with an average of 2,500 helicopter appraisals performed annually, and there is no source more accurate and dependable than HeliValue$' HeliCalc®. HeliCalc® is a pay-per-use program. Reports are available for purchase for a fee of $495 each. View a sample report. Customers who require a formal appraisal performed by an accredited HV$ appraiser after the purchase of a HeliCalc® report will receive a 10% discount on appraisal desktop fees within six months of the report date.
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