What Is Fractional Jet Ownership?

Fractional jet ownership is the professionally managed co-ownership of an aircraft. By purchasing a fractional ownership share of the aircraft, owners can share the use and costs of the aircraft. Each shareholder is allotted a specific number of occupied hours per year that they can use to fly the aircraft. The flying time usually ranges between 50 and 400 hours, and most fractional jet shares come in multiples of one-sixteenth.

Most aircraft that are used in fractional ownership are in the light or mid-sized jet families. The most common jets used within fractional ownership are:

Light single-engine and multiengine piston airplanes can also be used for fractional ownership. These types of fractional ownership are targeted toward private pilots, not business people. 

Each fractional owner of an aircraft will have a specified percentage of ownership that correlates to the number of hours that they can use the jet each month or year. Here are some examples of how these work:

Fractional jet ownership includes an array of fees. 

Within a fractional jet ownership agreement, there are many smaller agreements. It is important to read and understand the entire agreement before signing. 

The purchase agreement is the main agreement between the jet management company and the other fractional owners with whom you will share ownership of the aircraft. This agreement covers the provider’s warranties and representations related to the aircraft’s condition and title. This will also state how you will share the ownership with the other shareholders. 

This is an agreement between you, the shareholder, and the company that manages the aircraft. The agreement covers how many hours the fractional owner can fly, their flying costs, and when they can fly. These agreements will also show how rollover hours work, the owner’s right to interchange, where owners can fly, and peak travel days when the owner will have more restrictions. 

The master dry lease exchange agreement is an agreement between the fractional owners of the aircraft that explains the relationship between the fractional owners. This agreement usually has every owner sign off on the other owners using the aircraft.

The binder/deposit agreement is the initial fractional share purchase agreement. It requires a buyer to tender a deposit before the seller will hold the buyer’s share. This agreement also guarantees the owner’s pricing won’t change, states a firm delivery date, and identifies the particular aircraft in which the buyer is purchasing a share. 

There are many benefits to entering into a fractional jet ownership agreement over buying your own jet. 

While there are many advantages of fractional ownership, there are also some disadvantages. 

Fractional jet ownership will have a lower overall cost. Full ownership requires hefty upfront costs, like purchasing the aircraft, buying a hangar, and hiring a jet management company. Since fractional ownership allows all of these costs to be divided, it is less of a burden on individual shareholders. While full ownership eliminates the need to share usage of the aircraft, the increased costs may not make it worth it. Whether you are looking to purchase a jet for personal use or business, fractional jet ownership may help curb the costs. With maintenance and management of someone else’s headache, fractional ownership can give shareholders the luxury of flying private without the hassle and added expense of jet ownership. To learn more about fractional jet ownership, and stay up to date on all things aviation, subscribe to FLYING Magazine.