AIP Capital and Monroe Capital have formed a new joint venture targeting up to $1 billion in aircraft leasing assets, marking Monroe’s first foray into the aviation sector through a partnership with an experienced asset-based finance specialist. 

The venture will focus on acquiring mid-life aircraft placed on long-term leases to airlines worldwide. AIP, which manages about $4 billion in assets, will act as servicer for the portfolio. Monroe Capital is providing investment capital and has secured a $500 million senior secured warehouse facility—supported by Deutsche Bank’s New York branch and Fifth Third Bank—to finance initial acquisitions. 

“We look forward to scaling this venture over the coming months with Monroe, one of the most trusted firms in asset-based finance,” said AIP managing partner Jared Ailstock. 

Chicago-based Monroe, which oversees more than $20 billion across private credit strategies, sees the deal as a natural expansion. “This venture reflects our strategy of aligning with experienced operators in sectors with strong asset fundamentals and long-term demand visibility,” said Monroe managing director Aaron Peck. 

Aircraft leasing is gaining traction among institutional investors and private credit managers seeking resilient yield and diversification. A recent Coller Capital survey found that 59% of institutional allocators plan to increase exposure to aircraft leasing within commercial finance over the next two to three years. 

Gibson, Dunn & Crutcher advised AIP Capital on the transaction, with PwC acting as tax advisor. Monroe was advised by Milbank, with KPMG serving as tax advisor.