TO: Mayor and Members of City Council
THRU: Lachelle Pulliam, City Attorney
FROM: Kelly Strickland, Assistant City Manager
Andrew LaGala, A.A.E., Airport Director
DATE: June 23, 2025
RE:
Title
Approve FY26 Airport Residential Tenant(s) Fair Market Value Rent Adjustments
end
COUNCIL DISTRICT(S):
Council District(s)
All
b
Relationship To Strategic Plan:
Goal IV - Desirable Place to Live, Work and Recreate
4.1 - To maintain public transportation investments with high quality transit and airport services.
Executive Summary:
City Council is asked to approve a one-year phased rental adjustment bringing residential tenants to fair market value. City Council Policy 155.6 dictates that the lease rate for residential properties will reflect fair market value of the property. The City of Fayetteville Real Estate Division reevaluates rents parallel to the Cumberland County Tax revaluation on all rental properties.
The current rates were last established in the year 2019 with a 10% relief for aircraft noise levels as dictated by City policy. In March of 2025, new appraisals were acquired on all the residential properties. There was a significant increase in the rental amounts due to market conditions. In response to the increase, occupants were made aware of the new proposed rates. Staff proposed a phased one-year gradual increase to ease financial impacts.
The current rate produces $23,508 in annual property rents/non-aeronautical revenues. The recommended adjustment would produce $38,070 in annual revenues allotting for the previous relief for noise pollution.
Background:
• On March 17, 2025, City Staff hired Arsenal Appraisal, Incorporated to complete a market rental analysis on the following properties.
o 3593 Doc Bennett Road, Fayetteville, NC 28306
o 3519 Doc Bennett Road, Fayetteville, NC 28306
o 4015 Doc Bennett Road, Fayetteville, NC 28306
• The recommended adjustments resulted in an 80% increase on average. This is a 62% increase in annual property rents/non-aeronautical revenues.
• The adjustments would commence on the dates below.
o 1st Adjustment - 07/01/2025
o 2nd Adjustment - 01/01/2026
o Final Adjustment - 07/01/2026
Issues/Analysis:
None
Budget Impact:
There is no impact to the General Fund.
Options:
1. Accept a one-year phased rental adjustment for the Fayetteville Regional Airport residential occupants and authorize staff to proceed with execution of the Lease Agreements.
2. Do not accept the one-year phased rental adjustment for the Fayetteville Regional Airport residential occupants nor authorize staff to proceed with execution of the Lease Agreements.
Recommended Action:
Staff recommends Council accept the one-year phased rental adjustment for the Fayetteville Regional Airport residential occupants and authorize staff to proceed with execution of the Lease Agreements.
Attachments:
Draft Lease Agreements (FY26)