Blackstone has partnered with Dubai Aerospace Enterprise (DAE) to invest $1.6bn (£1.2bn) annually in commercial aircraft leasing.
The partnership, labelled Equator, will compile a portfolio of commercial aircraft on lease to airlines, with DAE sourcing the assets and its aircraft investor services group managing those owned by Equator.
Blackstone Credit and Insurance (BXCI) will provide the capital for the programme, including capital from funds managed by ITE Management, an investment firm focused on transportation infrastructure and one of Blackstone’s strategic partners.
The partnership marks a further step by Blackstone into asset-based credit, as its infrastructure and asset-based credit group now manages more than $100bn in assets.
“We are pleased to expand our aviation capabilities alongside DAE, a leading aircraft lessor with deep technical expertise and longstanding relationships with airlines and original equipment manufacturers,” said Aneek Mamik, senior managing director and the head of financial services for asset-based finance at BXCI. “This program underscores BXCI’s focus on deploying flexible capital into high-quality investments backed by hard assets.”
DAE, a global aviation services company, has approximately 700 aircraft, including more than 100 aircraft valued at over $4bn under management.
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“Blackstone’s scaled and flexible capital provides a strong foundation to grow our third-party fleet management franchise,” said Firoz Tarapore, chief executive of DAE. “Our fleet size, global customer and counterparty reach, and dedicated client support team makes DAE uniquely positioned to support Equator’s long-term success.”
The deal comes as Blackstone entered a strategic aircraft engine leasing partnership with Willis Lease Finance Corporation, with plans to deploy $1bn over the next two years.
Alongside Blackstone, alternative asset managers have been increasing their presence in the commercial aviation market. For example, Willow Wealth invested in a Blue Owl-backed aircraft leasing business operated by aviation investor Crestone Air Partners.
