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Monday, November 19, 2018 07.17AM / By Investec
Aviation (Sept 24, 2018)
Investec Aviation builds on track record with opening of new $500m
aircraft leasing equity fund
Investec
Aviation Finance is pleased to announce the launch of its fourth aircraft
leasing fund to acquire some of the latest generation Airbus and Boeing narrow
and widebody aircraft, on lease to a range of international airlines. The team
has a track record of more than 10 years in the space, having successfully
exited their previous three equity leasing funds.
The
new fund is targeting up to 50 aircraft acquisitions and has an expected
lifecycle of seven years. The fund is open to institutions looking to gain
exposure to aircraft leasing alongside an experienced manager and partner. The
launch of this new fund, Investec Aircraft Syndicate, responds to an ongoing
demand for alternatives and real assets as a complement to traditional asset
classes with which it is uncorrelated.
It
is further demonstration of Investec’s commitment to a sector where it has $6bn
of aircraft assets under management and has invested across the capital stack
over the last ten years. Investec is capping the fund at $500m and has already
secured over $150m of cornerstone investment from European financial
institutions. Investec Aircraft Syndicate’s second close is expected in Q1
2019.
Investec has a long track-record in aviation finance, launching its first equity fund, Investec Global Aircraft Fund (IGAF) in 2008. Investec has also pioneered the aviation debt fund product and has over $1.2bn of investments in various funds from financial institutions, including pensions and insurance companies. Across debt and equity, Investec’s funds are currently exposed to over 200 aircraft.
The
launch of the new fund comes at a time when consumer demand for airline travel
is projected to undergo further strong growth over the next 20 years. As a result,
airline manufacturers predict the size of the world’s commercial airline fleet
will double to more than 40,000 aircraft by 2035. This growth will require
financing in excess of $100bn per year, a cost which cannot be borne by the
airlines alone and will require significant institutional investment.
Aircraft
leasing has infrastructure-like characteristics and can generate attractive
absolute returns in comparison to other asset classes which have historically
attracted infrastructure and real assets investors.
Commenting
on the launch of the new fund, Alok Wadhawan, Head of Aviation Finance at
Investec said:
“Since we launched our first equity fund ten years ago, Investec’s platforms have delivered consistent returns to investors. We’ve managed aircraft through the cycle and have successfully monetised three funds by selling 75+ aircraft over the past three years, building strong credentials in this space. The commitment by insurance and pensions companies in the UK and Germany who have chosen us as a partner to advise on their investments in aircraft leasing through this fund are a testimony of our team’s capabilities. As we are approaching the second round of fundraising we are looking to deploy the initial capital.”
About Investec Specialist Bank
Investec is a specialist bank that provides a diverse range of financial products and services to a niche client base in three principal markets: the United Kingdom, South Africa and Australia, as well as certain other countries. This press release is issued on behalf of Investec Bank plc. Registered address: 30 Gresham Street, London, EC2V 7QP. (Reg No. 489604). Investec Specialist Bank is a brand name of Investec Bank plc, which is a member of the London Stock Exchange. Investec Bank plc (Reg. no. 489604) is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
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