How To Exit Your Fractional Aircraft Agreement

Fractional aircraft ownership offers a convenient and cost-effective solution for anyone who needs access to a private jet without the full responsibility of whole aircraft ownership. Agreements typically span five years, with options to exit on a shorter timeframe.

At the time of signing, most buyers are confident they will utilize their share for the full term. But life is unpredictable — businesses are sold, family needs evolve, or travel patterns shift — meaning that a share may not be needed for the full five years. And even at the end of an agreement, there are potential options to consider.

Before you commit to a fractional ownership agreement, it's crucial to evaluate your exit options. Having a well-defined strategy in place will ensure you're not caught off guard if circumstances change.

Exit Before Full Term

For most fractional owners, the simplest and most common exit route is returning the share to the program's management company. Each fractional provider has policies governing how shares are resold or repurposed, which are outlined in the original purchase agreement.

Most fractional agreements have minimum commitment periods — often 24 or 36 months — before allowing an exit. While early exits are possible, they may involve added costs or restrictions. That said, these extra fees may be more cost-effective than continuing ownership when the share is no longer needed.

When an owner looks to exit before the end of their agreement, the first question is almost always: what is my share worth? The answer depends on several interconnected factors — and understanding them can help an owner negotiate more effectively or time an exit strategically.

The primary driver is the remaining time under the agreement. As George Antoniadis, CEO & President of PlaneSense, explains succinctly:

"The value of the share depends on how much is left on the contract."
— George Antoniadis, CEO & President, PlaneSense

This flexibility allows owners to make changes even in the early stages of ownership.

For example, if a customer realizes within a few months that they need a different aircraft size, Flexjet will facilitate the transition. "We work with a customer to get out of their fractional share. Sometimes we'll try to sell the fractional share to someone else and other times, we'll use that share's time to support the needs of our other fractional owners," said D.J. Hanlon, Executive Vice President of Sales, Flexjet.

PlaneSense, which operates a fleet of Pilatus PC-12 turboprops and PC-24 light jets, follows a similar philosophy. "We are committed to providing flexible solutions, so there are no minimum tenure periods. If needs or lifestyles change, we don't want to have clients stuck in the wrong share," stated George Antoniadis.

When a share is sold before the end of an agreement, PlaneSense will normally act as a broker, advising the client on the value of their share. Occasionally, PlaneSense may buy back a share and use it to support other owners — comparable to the way Flexjet may also take back shares into its fleet.

When a fractional share is only a few months old, it may be priced similarly to a new share and sold to an incoming client. Otherwise, it gets repriced to reflect the market — a process that can work either in the seller's favor or against them, depending on conditions.

Fair Market Value Appraisal

At the end of a fractional aircraft agreement, the valuation process is often the most contentious part of the relationship. While you own a piece of an aircraft, the exit process is highly structured and largely favors the management company.

The valuation is almost always based on the Fair Market Value (FMV) of the aircraft at the time of the exit. However, "Fair Market Value" in fractional ownership is not a single number that you can look up; it is a calculated figure typically determined by the management company. As an owner, if you disagree with the value, make sure the contract allows for an independent appraisal.

Factors that affect the value include the aircraft utilization and general market conditions. Fractional jets fly significantly more hours per year (often 800–1,200) than private jets, and these high airframe hours drive down the value. In general, private aircraft values are cyclical, and if you exit during a downturn, you bear the market depreciation risk.

Your ability to negotiate at the end of the contract is limited by what you signed at the beginning. Some programs allow you to sell your share to a third party rather than selling it back to the provider, but the management company almost always has a Right of First Refusal.

If you are exiting one share to upgrade to a newer aircraft or a different program within the same company, you have significant leverage. Management companies are often willing to "over-allow" on your trade-in (essentially giving you a higher buy-back price) to keep you as a client and secure the next share sale.

Remarketing Fee

Most fractional aircraft companies charge a remarketing fee, typically around 7% of the share's resale value. Factor this into any exit planning from the outset.

Why Legal Counsel Belongs at the Beginning, Not the End

One often-overlooked step when entering a fractional ownership agreement is engaging an aviation attorney before signing. Fractional agreements are complex multi-year contracts, and the exit provisions — remarketing fees, minimum tenure periods, transfer rights, and buyback terms — are negotiated at the time of purchase, not at the time of departure. An experienced aviation attorney can review these terms with the end in mind, identifying clauses that may limit your flexibility or expose you to unexpected costs down the road. They can also negotiate more favorable exit language before you are committed, when your leverage is greatest. By the time you need to exit, the terms are already set; the best time to protect yourself is before you sign.

Overall, it's wise to consider an exit strategy before signing on the dotted line. Understanding the process, contractual commitments, potential costs, and timeline involved will ensure a smoother transition. By addressing this crucial factor upfront, fractional owners can enjoy the benefits of private jet access with greater confidence and peace of mind.