AIP Capital and Monroe Capital have launched a new aircraft leasing venture, focusing on a $1bn investment in mid-life aircraft on long-term lease to airlines worldwide.

AIP Capital will be the asset servicer while Monroe Capital will provide the investment capital.

Monroe Capital has secured commitments from Deutsche Bank AG New York Branch and Fifth Third Bank for an initial $500m senior secured warehouse facility.

This facility will support the acquisition of aviation assets.

AIP managing partner Jared Ailstock said: “We are excited to announce this partnership with Monroe Capital Alternative Credit Solutions. This venture provides scalable and stable capital; critically, it enhances value to our global airline customers and lessor trading partners even as capital markets have increased volatility.

Monroe managing director and co-head of alternative credit solutions Aaron Peck added: “We look forward to scaling this venture over the coming months with Monroe, one of the most trusted firms in asset-based finance. We are pleased to partner with AIP as we expand our asset-based finance business into the aviation sector.

“This venture reflects our strategy of aligning with experienced operators in sectors with strong asset fundamentals and long-term demand visibility. We believe aviation is a natural extension of our platform, and this venture positions us to deliver attractive, risk-adjusted returns for our investors.”

AIP Capital and its affiliates manage $4bn in assets for a global investor base.

The company operates with more than 30 professionals across its offices in Stamford, New York City, Dublin, and Singapore.

Headquartered in Chicago, Monroe Capital specialises in private credit markets, offering solutions in direct lending, technology finance, venture debt, and more.

Since 2004, the company has been providing capital solutions to clients in the US and Canada, with 11 locations across the US, Asia, and Australia.