unmadem
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Post by unmadem on Sept 8, 2015 10:32:43 GMT
I joined Ablrate pretty early on as it was doing something different from other P2P platforms - aircraft and they seemed to have an expertise in that. There have been precious few unique plane deals (some had multiple tranches). I thought I'd picked up that the new software would somehow help facilitate bringing deals to the platform but no great evidence of this so far.
ablrate I'd appreciate a candid assessment of the number of aircraft deals you have targeted for in the next year.
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unmadem
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Post by unmadem on Sept 14, 2015 19:59:41 GMT
No reply from Ablrate then, doesn't sound like we will see many loans secured on planes. I expect the adverts with the picture of the very sleek jet to change with one of a few shipping containers very shortly 
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locutus
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Post by locutus on Sept 14, 2015 20:39:32 GMT
This is something I have been wondering about too. We were given the impression that there would be lots of airplane deals once the new site was launched so I'm confused about the lack of opportunities. Even as I type this, there is an advert for Ablrate with a jet pictured prominently. An update would be welcome.
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Post by ablrateandy on Sept 14, 2015 20:40:10 GMT
Whoops sorry! The boss does policy. I do shipping containers, website errors and general dogsbodying and forgot to flag this to him.
We have an aviation pipeline and there is a lot of pedalling going on in the background. Obviously planes cost a lot so we have to get the "right" insto/quasi-insto underwriters in place (we are in deep discussions and doing DD with four or five guys) so that we can get deals that are accessible to private lenders too. As we get things ironed out we will update people.... in the meantime we have to keep churning deals out too to keep the lights on!
There is nothing more that we would like than to start doing lots of planes but we need to make sure that deals that go up get done.
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unmadem
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Post by unmadem on Sept 28, 2015 19:36:19 GMT
Yet another container loan flies out in seconds and no planes, must be time to change the advertising to show pile of containers rather than a plane now, surely ? . (Not that I'm complaining about getting a little of the 14%). |
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blender
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Post by blender on Oct 15, 2015 22:37:57 GMT
Whoops sorry! The boss does policy. I do shipping containers, website errors and general dogsbodying and forgot to flag this to him. We have an aviation pipeline and there is a lot of pedalling going on in the background. Obviously planes cost a lot so we have to get the "right" insto/quasi-insto underwriters in place (we are in deep discussions and doing DD with four or five guys) so that we can get deals that are accessible to private lenders too. As we get things ironed out we will update people.... in the meantime we have to keep churning deals out too to keep the lights on! There is nothing more that we would like than to start doing lots of planes but we need to make sure that deals that go up get done. A month ago the above was the position on the planes, and the ongoing lack of deals with underwriters. What progress has been made since then, please? It seems to me that the planes are the raison d'etre of the platform - not a few crates and containers. You are currently missing out on a substantial lender exodus from FC, while the ABLrate platform venture is presumably going rather more cash negative than planned. This is disappointing because the proposition is good and attractive, and deserves to succeed. It does appear that if an underwriting deal with planes was going to be possible then it would have been found in the last six months. So how have things changed since 14 September please?
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Post by ablrate on Oct 20, 2015 8:25:39 GMT
Whoops sorry! The boss does policy. I do shipping containers, website errors and general dogsbodying and forgot to flag this to him. We have an aviation pipeline and there is a lot of pedalling going on in the background. Obviously planes cost a lot so we have to get the "right" insto/quasi-insto underwriters in place (we are in deep discussions and doing DD with four or five guys) so that we can get deals that are accessible to private lenders too. As we get things ironed out we will update people.... in the meantime we have to keep churning deals out too to keep the lights on! There is nothing more that we would like than to start doing lots of planes but we need to make sure that deals that go up get done. A month ago the above was the position on the planes, and the ongoing lack of deals with underwriters. What progress has been made since then, please? It seems to me that the planes are the raison d'etre of the platform - not a few crates and containers. You are currently missing out on a substantial lender exodus from FC, while the ABLrate platform venture is presumably going rather more cash negative than planned. This is disappointing because the proposition is good and attractive, and deserves to succeed. It does appear that if an underwriting deal with planes was going to be possible then it would have been found in the last six months. So how have things changed since 14 September please? Hi We have had a third round of due diligence meetings with a company in the process of raising another large fund looking to invest in aircraft through the platform, that status where we are at now is discussing type, rating (Ascend 'rates' aircraft on the basis of a various number of criteria, such as demand, previous yield and residual performance etc), lessee profile preference and jurisdiction. Existing fund investors are also gearing up to bring in more capital to deploy with us. We have also been discussing various transactions with our usual banking suspects. Having learned a lot from 532 we want to make sure that these are done before we offer them out. In reality we need to be able to place at least £1 milion per deal in aircraft, and to really make a dent in our pipeline we need permanent capital to do it, that is what we are working on now. We are also looking at various potential products where we could bring in capital fro our investors (such as a fixed interest product with a variable 'bonus coupon' that we could use to get deals done. We are quite upbeat at the moment, despite the lull in aircraft deals, as we believe we will be in a position to place some more on the platform soon, but as we are talking about it, I would be interested to hear you views on this: - A fixed in interest loan product that pays 8% p.a over three years (or maybe 5), but also has a bonus element based on the residual value of the aircraft. Lets assume that residual yield brings the expected return to 11%+ and the loan would be based on capital into an SPV that invests in a single or multiple aircraft (each in their own SPV of course). The loan could be trade on on the SM, SPV holdings revalued each quarter.... How would people feel about something like that? The reason for the low initial interest is that any initial unallocated capital (while the funds were being raised, assuming instant returns, of course) would not be costing the spv huge money and it would be able to either invest in a mezz portion of a transaction or co-senior therefore attracting the residual value uplift at the end of leases.... it would make an interesting product.... Feedback welcome. Regards Ablrate
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jonno
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nil satis nisi optimum
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Post by jonno on Oct 20, 2015 8:54:47 GMT
ablrateandy; Morning Andy;talking of planes, what happened to the long promised "Twotter"?
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baldpate
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Post by baldpate on Oct 20, 2015 10:27:09 GMT
... A fixed in interest loan product that pays 8% p.a over three years (or maybe 5), but also has a bonus element based on the residual value of the aircraft ... Feedback welcome. Bread and scrape today, jam tomorrow - no thank you!... Feedback given.
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SteveT
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Post by SteveT on Oct 20, 2015 10:44:46 GMT
Unless there was a guaranteed route to withdraw funds when needed, so that money could be parked there in the short to medium term awaiting better options, it wouldn't appeal to me. Who knows where interest rates may be in 3 or 5 years and there are plenty of ways to generate significantly more than 8% (asset-secured) now that are either 6 month loans or else easily liquidated. Even 7% (after fees) with 2%CB on an FC 12-15 month property development loan beats that.
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pom
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Post by pom on Oct 20, 2015 10:50:12 GMT
Well I definitely prefer underpromise/overdeliver to the reverse. I'd certainly consider putting some in but then I invest over a very wide range of rates. Seems like it could potentially be quite a nice fire & forget product tho.
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registerme
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Post by registerme on Oct 20, 2015 11:40:03 GMT
It sounds unnecessarily complicated to me. You could address the "unallocated capital / intstant returns" issue by getting some kind of pre-funding commitment in place. That way you could offer a higher rate with less complexity. And as stevet says, there are other asset backed options out there that (currently) offer a higher rate over a shorter term.
Planes at ~10% over n years or property bridging finance at 12% over n months? It comes down to how much you value asset class / platform diversification. In a similar vein there are other loans on the ablrate platform that are more attractive in terms of rate and / or amortisation.
So not a "no" from me, but I think it needs a little more thought.
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huxs
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Post by huxs on Oct 20, 2015 12:18:54 GMT
I'm with pom, I probably would be tempted to invest in this but more as a platform and asset class diversity thing rather than because its the best investment available. I am not sure I fully understand the structure you are suggesting but if the rate was 8% with quarterly bonuses expecting to increase the rate to 11+% then that would appeal a lot more than a yearly or even at loan completion bonus that would tie you into the loan for a lot longer. |
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james
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Post by james on Oct 20, 2015 12:54:13 GMT
- A fixed in interest loan product that pays 8% p.a over three years (or maybe 5), but also has a bonus element based on the residual value of the aircraft. Lets assume that residual yield brings the expected return to 11%+ and the loan would be based on capital into an SPV that invests in a single or multiple aircraft (each in their own SPV of course). The loan could be trade on on the SM, SPV holdings revalued each quarter.... How would people feel about something like that? The reason for the low initial interest is that any initial unallocated capital (while the funds were being raised, assuming instant returns, of course) would not be costing the spv huge money and it would be able to either invest in a mezz portion of a transaction or co-senior therefore attracting the residual value uplift at the end of leases.... it would make an interesting product.... While I think I have some idea of how the mezzanine financing aspect could produce the potential for an uplift in overall value I think that you've just described something that is beyond the knowledge of most here and which needs more explaining. Would the mezzanine investment be in the same aircraft or something different? Where in the risk structure of the SPV or other property being invested in would the mezzanine sit compared to the secured lending in the main portion and how would lenders be exposed to risk from it? Not sure that most here even know that an SPV is just a company created to isolate and/or hold assets, commonly used to do things like own single ships as well as potentially in deals like this. In principle the first paragraph looks like a profit-linked lending deal, which can be quite interesting if the potential profit is likely to happen. In part, perhaps, because there may also be a return in the form of capital gain rather than interest, something that could produce a tax advantage for some. A challenge for lenders is appreciating the potential value of the uplift. Another is how the uplift is apportioned between the various parties. In essence this appears to be quite a good way for a borrower to fund an aircraft that they anticipate selling. Potentially very borrower-friendly. And if the uplift gain is well apportioned the potential gain may make it attractive to lenders. But what if they don't sell? How is the uplift from residual value determined?
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blender
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Post by blender on Oct 20, 2015 14:04:35 GMT
I can manage SPV but will then take cover under the umbrella that James has raised to protect those not really qualified to respond on the detail.
So, I will thank Ablrate for the reply to my challenging question, including the constructive approach to consulting potential lenders on what must be a difficult process to develop a sustainable offer on planes to p2p lenders.
Personally I do hope that this is successful and look forward to lending on a plane project in due course.
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