Blue Owl Capital Partners with Crestone Air for Aviation Venture

Blue Owl Capital Inc (OWL) has partnered with Crestone Air Partners to form Blue Crest Aviation Partners, focusing on acquiring mid-life commercial jet aircraft leased to airlines worldwide. The joint venture leverages Blue Owl's financial backing and Crestone's expertise in mature-phase aircraft management. While the venture offers high returns, investors should be mindful of risks associated with the aviation sector, including demand fluctuations and maintenance costs for older aircraft. The collaboration represents a growing trend in the aviation industry towards mid-life aircraft acquisition and management.

Blue Owl Capital Inc (OWL) and Crestone Air Partners have formed Blue Crest Aviation Partners, a joint venture focused on acquiring mid-life commercial jet aircraft leased to airlines worldwide. The venture leverages Blue Owl's financial backing and Crestone's expertise in mature-phase aircraft management. The collaboration represents a growing trend in the aviation industry towards mid-life aircraft acquisition and management.

Blue Crest Aviation Partners will seek to acquire mid-life commercial jet aircraft through a disciplined, income-oriented strategy. The joint venture is anchored by funds managed by Blue Owl Capital, Inc., and benefits from Crestone's integrated operating platform, which includes MRO, parts sales, storage, disassembly, and leasing services. The venture aims to capitalize on the mid-life aircraft market, which offers attractive returns but also presents risks such as demand fluctuations and maintenance costs for older aircraft.

Kevin Milligan, CEO of Crestone Air Partners, stated, "Blue Crest Aviation Partners represents the next step of scaling for our platform. We're proud to continue building with Blue Owl’s funds and deepen our alignment through a dedicated vehicle targeting opportunities in the mid-life aviation market" [1]. Ivan Zinn, Head of Alternative Credit at Blue Owl, added, "This joint venture builds on years of successful partnership between Blue Owl’s alternative credit funds and Crestone. We’re excited to continue supporting the platform with a further investment of strategic capital" [1].

The aviation industry is increasingly focusing on mid-life aircraft acquisition and management as a means to generate long-term investor value. Deucalion Aviation, another global asset manager specializing in mid-life commercial aircraft investment and servicing, has also announced a series of initiatives supporting its growth, including the expansion of its leadership team and geographic presence [3]. Deucalion's investment model leverages strong relationships with both lessors and airlines to curate targeted opportunities in mid-life aircraft.

While the mid-life aircraft market offers attractive returns, investors should be mindful of the associated risks. These include demand fluctuations, maintenance costs for older aircraft, and the potential impact of macroeconomic factors on the aviation industry. As such, the joint venture between Blue Owl and Crestone Air Partners represents a strategic move to capitalize on the mid-life aircraft market while mitigating risks through a disciplined investment strategy.

References:
[1] https://finance.yahoo.com/news/crestone-air-partners-launches-blue-120000602.html
[2] https://realassets.ipe.com/news/crestone-air-partners-and-blue-owl-create-aircraft-acquisitions-venture/10132129.article
[3] https://www.prnewswire.com/news-releases/deucalion-aviation-accelerates-global-expansion-and-strategic-focus-on-mid-life-aircraft-302524128.html