We believe that successful investing in commercial aircraft leasing, as with any other sector or industry, involves a disciplined approach with rigorous underwriting and analysis. Our goal is to properly determine whether the potential reward of a particular transaction is commensurate with its inherent risk.
Criteria such as age and type of aircraft, credit worthiness of the lessee, political and repossession risk in the country of operation, duration of lease term, redelivery conditions, motivation of seller, lease rate and selling price, are all important determinants in pursuing a particular transaction.
While endeavoring to achieve the highest possible risk-adjusted returns, we place great emphasis on protecting the downside risk of a transaction through careful analysis of the asset and return conditions in the lease. We seek to acquire "undervalued" assets where arbitrage opportunities might exist, as well as to enhance returns through value added activities such as lease extensions, lease repositioning, passenger to freighter conversion, or part-out. Our transactions typically include sale leasebacks with airlines and the acquisitions of aircraft subject to existing leases from third parties. For engine and airframe disassembly and sales, we strategically partner with companies who have the requisite infrastructure and expertise.
We typically source opportunities through non-auction style or competitive bidding processes, through international banks, airlines insurance companies, investment funds, lessors, hedge funds and other non-traditional industry participants. Our focus is on individual assets and aircraft portfolios ranging from $5 million to $50 million.