Global Jet Capital (GJC) was launched last year as a new source of leasing and lending options for business jet transactions. The U.S.-based company started with an initial $2 billion fund with the backing of three investment firms, GSO Capital Partners, The Carlyle Group and AE Industrial Partners.
The company is offering a range of operating and interim leases, finance leases and mortgage loans, progress payments and mezzanine financing (a mix of debt and equity financing) for both new and previously owned business jets. Its target market is aircraft valued at $30 million and higher, including pre-owned aircraft around three to five years old.
GJC expects to work closely with all the leading aircraft manufacturers to help customers who want their aircraft to be off-balance-sheet assets. It sees international markets beyond the U.S. as being a strong focus of its activities. Here at the ABACE show (Booth P602), it is represented by two of its directors, Robert Gates and Leona Qi, who are fluent in both Mandarin and Cantonese.
During the early months of 2015, GJC has been working on a number of prospective transactions involving Gulfstream, Bombardier and Boeing aircraft. “The flow of deals so far has exceeded our expectations and we have sourced several opportunities in Asia, Africa and South America,” executive director and chairman Shawn Vick told AIN.
The new group’s executive committee boasts a wealth of business aviation experience. Vick formerly held senior positions with Hawker Beechcraft, Gulfstream, Bombardier, British Aerospace and Landmark Aviation. Bill Boisture, formerly with Hawker Beechcraft, Gulfstream, NetJets and Butler Aviation, is an executive director. They are joined by David Rowe, founder and managing partner at AE Industrial Partners (previously known as AeroEquity and where Boisture and Vick also are partners). Rowe was formerly an executive vice president with Gulfstream Financial Services and GE Capital. Seven managing directors report to the executive committee—all of them with significant experience in business aviation and/or aircraft financing.
Vick told AIN that the new venture’s backers have been evaluating the market for around the past 36 months. “We see an opportunity in the market because the traditional sources of financing, such as the banks, took a step back and others have placed significant hurdles in the lending process so that the provision of lease financing or debt financing has proved to be challenging,” he said.
“[In recent years] Many businesses and individuals who have a requirement for large cabin and long-range aircraft have had to use their own capital to buy these, and then find financing [after the purchase],” explained Vick. He believes that GJC has a “significant opportunity” to help clients more finance their aircraft in a more flexible way and free up capital for their own businesses.
The new lender expects to be more willing to provide funds on the basis of the value of the assets being bought, rather than purely considering the personal credit status of the buyer. “One of the differences that we are bringing to the market is that we know these assets very well,” Vick told AIN. He said that GJC’s transaction approval committee will be able to give quick, clear decisions on finance packages.
GSO Capital Partners, which is a Blackstone group company run in partnership with Franklin Square Capital Partners, has approximately $69.5 billion in assets under management. The Carlyle Group is a global asset manager with a portfolio valued recently at $203 billion. AE Industrial Partners was founded in 1998 by David Rowe and his late father Brian Rowe.