Press

Private Debt

Aviation Debt

January 19, 2018

Innovative aircraft financing since 2014 with a total volume of over USD 1 bn

Due to increased capital requirements and the Covid-19 pandemic, some financiers have withdrawn from the aviation debt market. This offers institutional investors in search of secured investments the opportunity to achieve attractive returns. Prime Capital offers the right portfolio and access solutions for institutional investors.

An investment in aircraft loans is economically similar to an investment in amortising, attractively priced bonds, which are additionally secured by real assets. In the case of aircraft financing, the collateral consists of commercial aircraft used globally, which are thus stable in value. Prime Capital manages several individual fund and securitisation structures that invest in these attractive opportunities in the aircraft financing market.

Your benefits of Aviation Debt

  • Good growth prospects: Long-term growth in passenger volume, due to continued urbanisation leads to strong demand for aircraft and the corresponding finance
  • A highly standardised asset and controlled development of capacities: More than 80% of all aircraft in commercial use are delivered by Boeing and Airbus
  • Standardised financing structures: within a secure, international legal framework
  • Wide range of investment strategies: The aircraft finance market offers sufficient opportunities for a broad risk-return profile; this enables a range of investment strategies to be implemented on the basis of clearly defined investment criteria (e.g. regarding the credit quality of transactions and LTV)
  • Risk diversification: Low correlation with other asset classes. The portfolio is globally diversified, due to a worldwide commercial use of common aircraft by local airlines
  • Attractive opportunities: The Covid-19 pandemic has fundamentally changed the airline industry. A reduced supply of financing offers attractive returns for investors.

Our services within Aviation Debt

  • Global network in the aviation financing market (airlines and leasing companies)
  • Investment management with profound expertise in credit analysis as well as in the aircraft market. Many years of experience in aircraft financing with more than 200 aircraft financed and more than USD 1 billion AuM in this asset class.
  • Solution-oriented communication in the event of debt service disruptions in conjunction with relevant restructuring expertise.
  • Portfolio construction and management as well as risk management for our funds by using an institutional framework similar to established banking processes.
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