On Friday April 16th, Jet Midwest announced that it will sign two leases with the Kansas City Aviation Department, allowing it to consolidate and expand in more than 1 million square feet of space at the American Airlines overhaul base at Kansas City International Airport.

Jet Midwest CEO Patrick Kraus said the 17-employee firm is expected to add 500 to 750 jobs at the overhaul base within the next five years.

Implementation of the expansion plan will begin Monday, when the firm begins moving people and material from its current headquarters in the Fairfax Industrial District in Kansas City, Kan.

“We will be moving 200 truckloads of material from Kansas City, Kan.,” Kraus said, “and another 100 truckloads will come from Roswell (N.M.), Mojave (Calif.) and other places we have aircraft stored. I feel confident that we will have between 50 and 70 (employees’) cars in the (overhaul base) parking lot by the end of the year.”

Key to the company’s dramatic growth beyond that point will be three federal certifications it is pursuing that will allow it to perform its own repair work on aircraft components, airframes and engines.

Jet Midwest, which contracts for that work, expects to be able to bring it in-house at the overhaul base within about 18 months. By that time, Kraus said, he expects commercial airlines to have become buyers rather than sellers of used aircraft.

“We’ve bought multiple aircraft from people like Southwest when they had too much capacity,” Kraus said. “We’ll buy five, six or seven aircraft at a time, refurbish them and lease them out in another country or sell them to a private user. We currently use third-party work to repair our aircraft, engines and components. But we should be able to bring that work in-house by 2012, which is when we anticipate that the airline industry will begin consuming those aircraft that are still flyable and can be flown economically.”

In addition to closing its Fairfax operation, the leases at KCI will allow Jet Midwest to scale back its operations in the Southwest and on the West Coast. But it will maintain its sales office in Los Angeles and some of its aircraft storage in Mojave.

“We must maintain a presence at Mojave because that’s where the airlines are choosing to park their airplanes,” Kraus said. “But our intent is to take assets that can fly and bring them to KCI, where we’ll either perform maintenance of them or dismantle them, crunch up the aluminum and recycle the entire airplane. We also have aircraft stored in Miami, Merced (Calif.) and some places overseas. But we’ll no longer have to worry about keeping aircraft in four or five locations; we’ll consolidate our assets in Kansas City.”

Through one 10-year lease, effective April 15, Jet Midwest will lease 420,000 square feet in Building 2 at the overhaul base for $360,000 a year, subject to annual adjustments tied to the consumer price index. In addition, the lease calls for two 10-year renewal periods and gives Jet Midwest a right of first refusal to lease 80,000 square feet in the building occupied by Smith Electric Vehicles U.S., should that company leave.

Through another 10-year lease, effective no later than April 15, 2012, Jet Midwest will occupy all 600,000 square feet in Building 1, also known as the narrow-body hangar. It will pay $330,000 a year, subject to annual CPI adjustments, for that lease, which also includes two 10-year renewal periods.

In the near term, while Jet Midwest pursues its federal repairs certifications, it will operate under a short-term lease for Building 1. Through that agreement, Jet Midwest initially will lease one 29,000-square-foot hangar bay for $5,000 a month and could lease as many as five for $15,000 a month.

In October, American Airlines announced that it would close its overhaul operations at KCI, cutting about 490 jobs. The airline has since returned more than 1 million square feet of the 1.8 million-square-foot base to the city and expects to wind down operations in the remaining 740,000 square feet it leases by September.

“Landing Jet Midwest so quickly after American returned some of the space at the base is a major win for our residents,” Kansas City Councilman Bill Skaggs said.

Founded in 1997, Jet Midwest provides parts, engines, entire aircraft, plus leasing and management services. Its current airline customers include Air Canada, American Airlines, British Airways, Continental, Delta, FedEx, KLM and Mexicana

Read more: Jet Midwest lands dual-lease deal with Kansas City Aviation Department, may add 750 jobs – Kansas City Business Journal