DHS Bought Five Aircraft from Donor-Linked Daedalus Aviation at Steep Markups on Noem's Last Day, NYT Reports

The Department of Homeland Security agreed to purchase five aircraft from Daedalus Aviation Corporation at substantial markups on the final morning of Kristi Noem's tenure as DHS Secretary. DHS paid $108 million for a Boeing 737 airliner converted into a private jet — fitted with a stand-up bar, two bedrooms, marble showers, and a table covered in manta ray skin — though Daedalus had purchased the aircraft for less than $90 million just months earlier.

DHS also agreed to pay $106 million for two Gulfstream luxury jets that Daedalus had acquired for approximately $83 million. DHS additionally bought two 17-year-old Boeing 737 passenger planes at $45 million apiece. Daedalus's chairman, William Walters, donated $10,000 to Noem's political action committee, American Resolve, in 2024. Daedalus said Walters was unaware at the time that the PAC was associated with Noem, though an archived version of American Resolve's website prominently featured Noem's name and image.

President Donald Trump fired Noem in early March following a series of scandals involving DHS expenditures, though she remained in her post until her successor, Markwayne Mullin, took over later that month. Two White House officials said Mullin considered cancelling the deal but feared a significant financial penalty; after consulting with White House Chief of Staff Susie Wiles, who shared his concerns, he allowed the purchase to proceed. Noem, now serving as a special envoy at the State Department, declined to answer specific questions about the sale or the prices paid, and called the reporting "factually incorrect" and "libelous" on X, adding that characterizing Walters as a "donor" was "materially misleading."

Government aircraft procurement sits at the intersection of political appointments and a private jet resale market where prices are negotiated case by case rather than set by public benchmarks, which is exactly the gap this deal exploited. A seller who buys an aircraft and resells it within months at a markup of tens of millions of dollars is operating in a segment where valuation depends heavily on configuration, timing, and who is asking — a converted 737 with custom interiors has no standard comp, and neither does a government buyer under deadline pressure.

The case also shows how a contract signed on an outgoing official's last day can bind an incoming administration: Mullin's team weighed cancellation against a financial penalty and chose to proceed, which is the practical leverage a seller holds once a deal is signed but not yet closed. Whether that penalty clause, its size, and the full terms of the Daedalus contracts become public will determine how much scrutiny this specific transaction ultimately draws, and whether Walters's donation to Noem's PAC is treated as incidental or material to how the deal was priced.