Sep 24, 2024
The Next Era of Private Credit: A new private credit ecosystem is emerging across asset managers, banks, and insurers. Here’s what it means for the industry.
Private credit has been one of the fastest-growing segments of the financial system over the past 15 years. The asset class, as commonly measured, totaled nearly $2 trillion by the end of 2023, roughly ten times larger than it did in 2009.1 While that total remains a small fraction of the broader fixed-income landscape, private financing solutions continue to perform well—and win, in many instances—against bank and public alternatives. In fact, our analysis suggests that the size of the addressable market for private credit could be more than $30 trillion in the United States alone. . . .
Jul 22, 2024
Heli Help For A Planet 'Literally on Fire'. (Shame About Rates):
Demand for firefighting helicopters has never been greater. Both the number and intensity of wildfires worldwide is fuelling the need for more aerial support – both rotary wing and fixed wing. The trouble is that prices and terms of many rotary firefighting contracts are too low to justify investment, according to the panel dedicated to the topic at our recent Helicopter Investor conference.
Let’s start with demand. When António Guterres, secretary-general, United Nations warned the planet is “literally on fire”, he wasn’t speaking exclusively about wildfires. But he might have been. What were separate seasons in the Northern and Southern Hemisphere – enabling assets to relocate between the two – have now merged, says Jason Diniz, president of lessor Eagle Copters. . .
Jul 3, 2024
US gives key approval to Atlantic Shores offshore wind farm in New Jersey:
The U.S. Interior Department approved the proposed Atlantic Shores offshore wind farm in New Jersey on Tuesday, giving a major boost to a project that would be the state's first.
The project still requires an additional federal approval of its construction and operations plan, along with two state-level permits, before construction can begin.
Interior Secretary Deb Haaland said the department's decision marked the ninth offshore wind project approved under the Biden administration, green-lighting 13 gigawatts of electricity, enough to power 5 million homes. . .
Jun 30, 2024
Japan looks farther out to sea for overdue wind power boost:
One would only need to look at a map to understand the potential offshore wind has for a country like Japan. Now, the government is eyeing moves to truly harness it.
Time may have run out in the just-completed session of parliament for a new legislative amendment that promised to provide a major boost for Japan’s sputtering wind industry by opening up vast amounts of marine territory for offshore turbines, but the bill’s next chance at passage could come as soon as this fall.
That would be no small matter, with wind power advocates saying that the amendment could spur development of an industry that many believe is Japan’s best chance at achieving carbon neutrality by 2050. . .
Jun 29, 2024
Universal Hydrogen, pioneer of hydrogen-powered flight, goes bust
Universal Hydrogen, the pioneering company that flew a partially hydrogen-powered flight out of Moses Lake in March last year, has burned through the $100 million it raised from investors and gone bust.
The company was one of a few aiming to replace fossil-fuel powered flight with more sustainable, emissions-free technology, in this case using hydrogen to power the engines instead of jet fuel.
Its achievement of a first flight at Moses Lake was celebrated by Gov. Jay Inslee as one of Washington state’s clean energy breakthroughs. . .
Jun 24, 2024
Private Capital in Focus: Q1 Performance and a Dive into Distributions
Returns for private-credit funds continued to eclipse returns for private equity and private real assets in Q1 2024.
The slowdown in private-equity distributions, a key concern for asset owners, was again evident at the start of the year, with preliminary Q2 data indicating a further deterioration.
The 2015-19 vintage years for venture capital and private real estate, which should be into their peak harvesting years, have stalled in distributing capital. . .
Jun 19, 2024
[WSJ Pro subscription required] Pro Take: Asset-Based Financing Is the New Star of Private Credit: Investors in private credit are looking for ways to juice returns as yields compress in the core direct lending strategy
Direct lenders and their investors are abuzz with asset-based financing, a burgeoning trend in private credit.
At conferences and private meetings, fund managers are eagerly discussing loans backed by real assets, such as equipment and inventory. Unlike corporate debt, these loans are thought to be better shielded from the vagaries of the economy because lenders rely on the value of the assets rather than the borrower’s financial condition, fund managers say.
By expanding beyond traditional direct loans, private lenders are venturing into yet another area banks used to dominate.
“Demand for asset-based lending is off the charts. It’s the Taylor Swift of private credit,” said Jess Larsen, founder and chief executive of Briarcliffe Credit Partners, a placement agent. “With economic growth in question, capital has to be deployed somewhere else rather than betting on U.S. corporate health.” . . .
Jun 15, 2024
[WSJ subscription required] Pensions Piled Into Private Equity. Now They Can’t Get Out: Retirement funds seek cash while money languishes in zombie investments
Private-equity and pension funds seemed like a match made in heaven. U.S. companies and states handed over control of some worker retirement savings. In exchange, they got a promise of high returns after a decade—and often received healthy cash payouts in the years before that.
Now the honeymoon is over. The payouts have dried up, creating an expensive problem for investment managers overseeing the savings of workers retired from big corporations and state and city governments. . .
Jun 14, 2024
He Ain't Heavy, He's My Brother: A Detailed Look at the Offshore Helicotper Capacity Equation
New capacity analysis in the heavy and super-medium segments by LCI Analytics paints a very interesting picture around supply and demand, with age out assumptions driving large parts of the narrative.
Background
We’ve been crunching the numbers for the future evolution of the heavy and super medium offshore fleets. This follows animated discussion at last week’s Helicopter Investor conference about the size, firmness and delivery profile of the super-medium orderbooks and the potential impact on the market going forward. . .
Jun 12, 2024
Net Present Value Solves a Landlord-Tenant Bargaining Problem, 400 Years Ago
Back in 1628, Ambrose Acroyd published a book called Tables of Leasses and Interest. Acroyd was an administrator at Trinity College from 1615-1625, including a role as senior bursar–the modern equivalent might be “chief financial officer”–for several years. The first table of his book focused on a specific situation:
Acroyd’s unusual Table i envisions a very specific situation: one party owns an annuity with a full term of twenty-one years, several of those years have already expired, and the annuity owner wishes to pay to extend that annuity’s term back to a full twenty-one-years. Imagine someone possessing an annuity paying £1 annually for twenty-one years and fourteen years had already expired, leaving seven remaining. Acroyd’s first table states how much should be paid to “fill up” that annuity back to twenty-one years: in this case, £3 5s.11d., found on row “14” in the table.
Jun 11, 2024
Aircraft leasing: Alternative ways to invest
Pop quiz: What company owns the plane in the image below?
The answer might seem obvious, considering the American Airlines logo staring you in the face.
But as it turns out, things aren’t so simple.
The odds that American Airlines actually owns the plane are only a little better than a coin flip.
As of the company’s latest annual report, American Airlines has a total of 965 planes in its mainline fleet. Of these, just 495 are owned — with the remaining 470 leased from another company.
That near 50-50 lease ratio is in line with the industry average. 53% of all commercial aircrafts in operation today are leased. . .
Jun 2, 2024
[PDI subscription required] Growth opportunities: Asset-based lending - Lenders are keen to diversify away from cashflow-based lending into more esoteric areas.
After a decade of booming activity in mid-market direct lending, many lenders are eyeing an opportunity to diversify away from cashflow-based lending into more esoteric asset-based finance. Whether lending against portfolios of performing or non-performing consumer loans, music royalties or trade finance receivables, the asset-based credit landscape is a fast-expanding frontier for creative lenders.
“We think asset-based credit is probably one of the most ripe and persistent opportunities in the market today,” . . .
May 23, 2024
[subscription required] Iran President’s Crash Highlights Struggle to Upgrade an Aging Fleet: Ebrahim Raisi died aboard a U.S.-made helicopter model that dates to the Vietnam War era, a reflection of Tehran’s difficulty in securing parts amid sanctions
In July, the commander of Iran’s air force used a set of public remarks to offer some offhand praise for the country’s chopper armada. “Today, the Iranian Army Aviation functions as the largest and strongest helicopter fleet in West Asia,” Brigadier General Yousef Ghorbani said at a press conference.
The crash that killed Iranian President Ebrahim Raisi and his foreign minister this past weekend tells a different story: They died aboard a decades-old U.S.-made helicopter, part of an aging fleet that has been starved of spare parts by Western sanctions. . .
. . .Today, the average age of the country’s 290 helicopters is roughly 38 years, compared with a global average of about 23 years, said Rob Morris, global head of consultancy at Cirium Ascend.. . .
May 20, 2024
[WSJ subscription required] A $10 Billion Real-Estate Fund Is Bleeding Cash and Running Out of Options: The Starwood Real Estate Income Trust, known as Sreit, has three choices—none of them appealing
A giant commercial real-estate fund is scrambling to escape a looming cash crunch caused by the long line of investors who want their money back.
The $10 billion fund from Starwood Capital Group has been trying to preserve its available cash and credit by limiting investor redemptions. In the first quarter, the fund was hit with $1.3 billion in withdrawal requests but satisfied less than $500 million of them, according to regulatory filings. . .
May 17, 2024
IBA data: Helicopter leasing rates exceed 10%, with more growth projected
Leased commercial helicopters have surpassed 10 percent of the global fleet, thanks to rising overall demand for rotorcraft and increased preference for financing over outright cash purchases, according to new data from the IBA Intelligence aviation consultancy.
In a market update for industry observers on May 15, 2024, IBA reported 300 lease transactions last year, down slightly from 2022 but outpacing previous years.
“We are also witnessing a surge in demand in helicopter markets,” said Rami Abel Aziz, manager of IBA’s helicopters division. . .
Apr 30, 2024
When Fear Is a Friend – US Multifamily in Focus
Rising interest rates have taken their toll on U.S. multifamily housing, as they have on other commercial real estate sectors. Debt levels relative to equity are higher in multifamily than in some other segments, a loan maturity wall looms, and interest rate caps are expiring, putting many owners in the position of refinancing at a time when their properties are worth less than their acquisition basis and interest rates are much higher. Plus, a wave of new supply will come on the market over the next two years. Some have wondered whether multifamily housing is in for a period of significant defaults and distressed deal flow similar to that of the office sector. . .[ed note: the example provided within implies that an asset acquired in 2021 at a 3.5% cap rate should have its equity marked down between 50-80% at today's 5.0-5.5% cap rates]
April 28, 2024
Private Credit's Next Act: Why private credit is tapping into asset-based lending
Private credit is looking to catch the next wave of growth — in asset-based lending. In part, that is to sustain the sector’s extraordinary growth and to satisfy the sea change in allocations to credit. But firms are also jumping in because leveraged lending has become more crowded. How large is the addressable market? Our new estimates suggest specialty finance is a $5.5 trillion asset opportunity in the United States alone, where private credit today has less than a 5% share.
The need to secure access to these new asset classes is prompting private credit players to change tack, looking to partner up with banks rather than be their adversaries. We explore what private credit 2.0 might look like — for banks and investors.
Apr 23, 2024
Long-Term Private Equity Performance: 2000 to 2023
Private equity allocations by state pensions produced a 11.0% net-of-fee annualized return over the 23-year period ending June 30, 2023, exceeding by 4.8% the 6.2% annualized return that otherwise would have been earned by investing in public stocks.
Our annual performance study now includes 20232, a year that produced a modest 0.8% return for private equity compared to a 17.5% return for the public stock market equivalent return. The large shortfall in private equity return for 2023 is due to a valuation spillover from the 2022 drawdown in public stock values. A two-year lookback shows private equity earning a 10.3% annual return compared to 0.2% for the public stock market equivalent. . .
Apr 17, 2024
The Indispensability of Risk
Oftentimes, we’re best able to understand something we’re interested in through analogies that clarify the matter by establishing connections between it and other parts of life. That’s why I’ve written a memo comparing investing to sports in each of the four decades I’ve been writing memos and one connecting investing and card playing in 2020.
The motivation for this memo comes from an article in The Wall Street Journal of April 12 that my partner Bruce Karsh sent me entitled “Chess Teaches the Power of Sacrifice” by Maurice Ashley, a chess grandmaster who has been inducted into the U.S. Chess Hall of Fame. Few people know that Bruce is a chess player, and I hadn’t thought about this fact for years, but the article provided a good reminder and moved me to dash off this memo. . .
Mar 22, 2024
The disintermediation of lending: Private debt shines bright
In the realm of alternative assets, private debt has emerged as shining star, experiencing a rapid evolution and now basking in what many are calling a golden moment. Amid rising interest rates, private debt has remained remarkably resilient, delivering robust returns, and attracting fervent investor interest. However, some questions are emerging about how resilient private debt will be in future as well as where the best opportunities now lie, particularly as syndicated loan and high-yield bond markets rally.
To help sort the fact from the fiction we sought views from John Popp - Global Head and CIO of the Credit Investments Group at Credit Suisse Asset Management, Andrew Strommen - Senior Investment Analyst in Active Equities, Tiffany Gherlone - Head of Real Estate Research, US, Baxter Wasson - Co-Head of O’Connor Capital Solutions, and Viktor Kozel - Head of Infrastructure Debt, Real Estate & Private Markets at UBS Asset Management. . .
Mar 14, 2024
HI Uplift: Why ‘eVTOL nirvana is a million miles away’
Barbie and Ken. Salt and pepper. Some partnerships seem beyond question. But how about heliports and eVTOLS? Or the integration of helicopter and other fixed-wing aircraft with eVTOL commuter services? Well, maybe – but not yet.
That was the consensus to emerge from a session focusing on vertiports at the recent British Business & General Aviation Association (BBGA) conference in London. That is despite Volocopter forging ahead with plans to demonstrate the first public eVTOL services at this summer’s Paris 2024 Olympic Games. . .
Mar 8, 2024
Supply-demand imbalance driving strong performance for aircraft lessors
With air travel returning to pre-pandemic numbers, aircraft lessors can capitalise on supply issues in aircraft manufacturing
With air travel now returning to pre-pandemic levels, KPMG believes that the outlook for airlines and leasing companies is positive, provided they can access the aircraft they need to drive profitability and growth.
“The recovery in air travel up to last year was fragmented, with the US and Europe leading the way,” commented Joe O’Mara, head of aviation and tax partner, KPMG. “But with all restrictions now lifted, Asia bounced back strongly, and the end of 2023 saw global air travel rise above 2019 for the first time. Given global GDP has increased significantly since that time, there remains a lot of growth to recapture.”. . .
Mar 4, 2024
Is private equity actually worth it?
Alphaville examines the investment case for the Norwegian sovereign wealth fund adding the finance industry’s hottest asset class to its mandate
Last November, the $1.6tn Norwegian sovereign wealth fund asked the government for the umpteenth time if it could be allowed to invest in private equity. That’s a good excuse to explore one of the financial world’s most controversial issues. . .
Feb 28, 2024
Flawed Valuations Threaten $1.7 Trillion Private Credit Boom
Colm Kelleher whipped up a storm at the end of last year when the UBS Group AG chairman warned of a dangerous bubble in private credit. As investors dive headfirst into this booming asset class, the more urgent question for regulators is how anybody could even know for sure what it’s really worth.
The meteoric rise of private credit funds has been powered by a simple pitch to the insurers and pensions who manage people’s money over decades: Invest in our loans and avoid the price gyrations of rival types of corporate finance. The loans will trade so rarely — in many cases, never — that their value will stay steady, letting backers enjoy bountiful and stress-free returns. This irresistible proposal has transformed a Wall Street backwater into a $1.7 trillion market. . .
Feb 6, 2024
Petrobras plans $100bn in spending to persist through ‘fade-out of oil’: State-owned Brazilian energy group’s CEO embraces exploration, global expansion and renewables
Petrobras intends to be one of the last remaining oil producers on the planet, the Brazilian energy company’s chief executive said as he outlined a $100bn-plus investment plan concentrated on offshore oil exploration and production.
Jean Paul Prates told the Financial Times that Latin America’s largest oil and gas company is considering a fresh wave of international expansion in Europe, west Africa and the Americas as part of a strategy overhaul. . .
Jan 16, 2024
Smith, Wyden Announce Agreement on Tax Framework to Help Families and Main Street Businesses
Three-Year Proposal Would Help Families, Spur Innovation, Improve Economic Competitiveness, Boost Affordable Housing
House Ways and Means Committee Chairman Jason Smith (MO-08) and Senate Finance Committee Chairman Ron Wyden (D-OR) announced a common sense, bipartisan, bicameral tax framework that promotes the financial security of working families, boosts growth and American competitiveness, and strengthens communities and Main Street businesses. . .
Jan 9, 2024
Which Provisions of the Tax Cuts and Jobs Act Should Be Made Permanent?
The 118th Congress returns to Washington this week with a major tax elephant in the room—most of the 2017 tax reform law will expire after the end of next year. If lawmakers allow full expiration to occur, most Americans will see their personal tax bills rise and incentives for working and investing worsen. Extending the entire tax reform, however, would come with a $3.7 trillion price tag at a time when the country’s fiscal outlook is already bleak.
Lawmakers should use the year ahead to thoroughly review and debate lasting, fundamental tax reform and prioritize policies that best boost work and investment incentives in a fiscally responsible manner. . .
. . . Some tax cuts create a larger economic boost than others. . .
. . . The most powerful provision under that metric is full expensing for business investment in equipment, followed by expensing for research and development costs. . .
Nov 16, 2023
[WSJ subscription required] Your Ambulance Is on the Way. ETA: 65 Minutes.
Rural patients can wait an hour or more for emergency responders from strained services
Call 911 in this northwest Nebraska town, and the ambulance responding will likely be coming from South Dakota.
If that crew isn’t available, the ambulance might drive from Valentine, Neb., 60 miles and a different time zone away. Or from Gordon, where the all-volunteer staff includes employees of a grocery store, bank, veterinary office and farmer’s co-op.
“You’re looking at an hour or longer for a response,” said Rose Chappell, the last emergency medical technician in Merriman, which had to shut down its ambulance service. . .
Oct 24, 2023
Air Methods Takes Strategic Steps to Position Business for Long-term Success
Air Methods Corporation (“Air Methods” or the “Company”), the leading air medical service provider in the U.S., announced today that it has entered into a Restructuring Support Agreement (“RSA”) with (i) majorities of its first lien lenders and bondholders and (ii) its equity sponsor under which such key stakeholders have agreed to support an expedited balance sheet restructuring. Implementing the restructuring contemplated by the RSA will reduce the Company’s total debt by approximately $1.7 billion, increase liquidity and position the business for long-term success by allowing it to focus on its growth and development strategies. . .
Jul 28, 2023
A Tax Trap Awaits Affluent Clients Seeking Income
The sharp rise in interest rates over the last 15 months has created a surge in clients looking for short-term investments for their cash.
The Federal Reserve has briefly paused raising rates as part of its campaign to curtail inflation, but the move is expected to be only temporary. Many analysts expect another 0.25% rate hike later this month. . .
May 15, 2023
Briarcliffe Field Guide to Private Credit
We are pleased to introduce the Briarcliffe Field Guide to Private Credit™, your companion for the journey through the panorama of this broad and growing asset class. It provides descriptions and key characteristics of each of the 26 sub strategies that comprise our Four Pillars of Private Credit™. The insights within the guide are informed by our deep private credit expertise coupled with the regular conversations we hold with some of the most active and astute investors, managers, and consultants in the industry.
Mar 28, 2023
The 'New' Heavy-Life Utility Helicopters: How the UH-60 Black Hawk, CH-47 Chinook and AS332 Super Puma are performing in firefighting and utility operations — and reshaping the market in the process.
Over the past decade, the fleet of heavy-lift helicopters dedicated to fire and utility work in North America has been undergoing a transformation.
In the United States, as the Army has divested Sikorsky UH-60A and L model Black Hawks and Boeing CH-47D Chinooks, these military workhorses have made their way into the civilian world as public use or restricted category aircraft, where they have excelled in firefighting and construction roles. In Canada and elsewhere around the world, the Airbus AS332 Super Puma has become increasingly popular for the same kind of work as it has been phased out of the oil-and-gas market. . .
Mar 23, 2023
Offshore helicopter sector ‘sleepwalking into crisis’ as demand outstrips supply
“Significant price inflation” is forecast to grip the offshore helicopter sector as demand for choppers outstrips the number available.
Research group Air and Sea Analytics says the ability of operators to “keep enough serviceable aircraft active” to meet requirements is now “in question”. . .
Feb 2, 2023
Rotorcraft rally could be led by emerging markets: Opportunities are opening up for helicopters in new offshore wind markets
The offshore wind market is growing strongly, driving demand for helicopters and new vessels, but the biggest potential markets for rotorcraft could lie outside established offshore wind provinces.
To get an overview of the market, OWJ turned to Air & Sea Analytics founder and principal Steve Robertson. Mr Robertson, a long-time analyst of the market for helicopters in the offshore oil and gas and offshore wind markets, says the underlying market is “strong almost everywhere,” from established to emerging markets. But he explains there are limitations on growth in demand for helicopters for use in offshore windfarms – and these are primarily supply-chain constraints – and pushing growth faster than current levels “will be tricky,” regardless of government targets and incentives. . .
Jan 22, 2023
How eVTOLs Could Disrupt The $49B Helicopter Industry
With an estimated 200 companies working on them, electric vertical take-off and landing vehicles are taking the aviation industry by storm. And while vertical lift aircraft have existed for more than a century in the form of helicopters, eVTOLs could disrupt the $49 billion industry in certain segments due to their cheaper maintenance and operating costs. CNBC spoke with one startup, Archer Aviation, which counts United Airlines as one of its investors, about why we could see these new aircraft change how people travel. . . [YouTube]
Jan 21, 2023
The Offshore Oil Business Is Gushing Again: Rigs that haven’t been used in years are setting out to sea as demand for energy surges. ‘Everyone started drilling again.’
The $1.2 billion Deepwater Titan sat idle in a Singaporean shipyard for five years, looking like an abandoned cruise ship with a derrick attached to its deck. Soon this vessel that spans nearly three football fields will depart for the deepest waters of the Gulf of Mexico, where its crew will be able to drill 8 miles below the seafloor in search of oil for Chevron Corp.
The hunt for offshore petroleum is on again, fueled by a surge in global demand for energy, supply disruptions triggered by the war in Ukraine and crude prices that remain above prepandemic levels. . . [subscription]
Jan 17, 2023
Expected Returns for Private Equity Will Probably Suck
This article attempts to demystify the approach and methodology used to characterize the risk and return relationship in private equity today. The illiquid nature of the asset class makes the demystification of private equity returns difficult to achieve under any circumstances. Still, the framework presented in this article should move the reader closer to the goal. . .
Jan 10, 2023
Offshore [Helicopters] – Reasons to be cheerful: By quarter three 2022, values for both the challenged Sikorsky S-92A and Leonardo’s AW139 saw improvements following the strengthening in demand.
The indicators at the start of 2022 pointed towards an offshore aviation market with a good opportunity of stabilizing with high oil prices and continued consolidation. However, surplus was still notable, mostly for types with a high proportion of the fleet exposed to the volatile oil & gas sector. . .
Jan 1, 2023
Soaring Costs Threaten U.S. Offshore-Wind Buildout: Companies behind big East Coast projects are looking to renegotiate contracts as inflationary pressures upend financial models
Offshore wind developers are facing financial challenges that threaten to derail several East Coast projects critical to reaching the Biden administration’s near-term clean-energy targets.
Supply-chain snarls, rising interest rates and inflationary pressures are making projects far more expensive to build. Now, some developers are looking to renegotiate financing agreements to keep their projects under way. . . [subscription]
Dec 15, 2022
Global Air Ambulance market expected to be worth USD50bn by 2032
Market analysts Fact MR 2022-2032 Air Ambulance market to be worth around USD50 Billion in 10 years time thanks to a remarkable compound annual growth rate(CAGR) forecasted to be 11% for the period 2022-2032. What is intriguing in the report is that Fact MR had already forecasted a bullish 8% in the same report last year. According the the report, the growth will be driven primarily by the demands for critical care as the population ages. Unsurprisingly, the report points to the US market as the most developed followed by Europe even so, it expects double digit CAGR in these more mature markets. It doesn’t rule out more exponential rates in Asia and Asia Pacific. . .
Nov 28, 2022
Lies, Damn Lies and Performance Benchmarks
Don’t trust analysis from managers that shows they have outperformed an appropriately selected, passive benchmark. That is true for mutual funds, and new research shows it is equally accurate when it comes to endowments and pension funds. . .
Nov 24, 2022
HI Uplift: HEMS opportunities for lessors and pre-owned
Growing demand for Helicopter Emergency Medical Services (HEMS) could boost demand for leased and pre-owned aircraft, as more new production is directed towards military applications – particularly in Eastern Europe. That was the message from Helicopter Investor’s recent Town Hall online meeting dedicated to the market.
The HEMS market will experience strong long-term growth, particularly in wealthy regions such as Europe. . .
Nov 9, 2022
Keeping Europe’s offshore wind parks running
During last year’s European Rotors, Airbus announced the delivery of a five-bladed H145 to the German Operator HTM Helicopters – a year on, we sat down with the operator to check how the helicopter has proven itself in this industry.
Helicopters are an important tool for the offshore wind industry – whenever maintenance of a wind park is necessary, whether it is planned or unplanned, helicopters are able to bring technicians and material in under one hour to wherever they are needed. The deployment of offshore wind energy is at the core of delivering the European Green Deal. . .
Sep 9, 2022
An old aerodynamic problem could pose a new challenge for eVTOL aircraft Emerging research suggests that vortex ring state will be a danger for eVTOLs:
Electric vertical take-off and landing aircraft present some obvious safety challenges with respect to their flammable lithium-ion batteries and their novel configurations, which, unlike an airplane or helicopter, may not be able to glide to the ground in the event of a total power loss. Now, a new paper suggests they may also face special challenges in avoiding a hazardous aerodynamic condition: vortex ring state (VRS). . .
Aug 16, 2022
When Data Fails
". . .We see the same issue in the financial world when someone chooses an investment because of its high return without considering its volatility. Once again, when you only consider a subset of the information available, you run the risk of a bad outcome. . ."
Aug 1, 2022
Wildfires Are Getting Worse, And More Costly, Every Year
A combination of climate change, federal policy and residential patterns have sent the costs of fighting wildfires soaring:
The cost of fighting wildfires has risen in recent decades along with their severity and the damage they have inflicted, and 2018 appears to be no exception.
The U.S. Forest Service, the primary federal agency in charge of fighting wildfires, and other Department of the Interior agencies spent an all-time high last year of more than $2.9 billion combating fires – more than 12 times what was spent on suppression efforts in 1985, according to data from the National Interagency Fire Center. The 2017 figure is still more than five times higher than the amount spent in 1985 when adjusted for inflation. . .
Jul 17, 2022
[subscription] Extreme Heat Scorches Europe, Fueling Wildfires, Drought
Continent has become tinderbox, with unseasonably high temperatures reaching as far north as London:
Wildfires spread across Spain, France and other parts of Europe as torrid heat mixed with months of little rain to make the continent a tinderbox.
In Spain, where heat records have been set repeatedly since June, the temperature topped 115 degrees Fahrenheit in some areas over the weekend. Firefighters have been confronting wildfires since June. On Spain’s Costa del Sol on the Mediterranean coast, authorities evacuated several thousand people as fires spread toward inhabited areas. . .
Jul 14, 2022
Resurgence in Heavy & Super-Medium Offshore Helicopter Utilisation:
The latest census of active offshore crew transfer helicopters in the heavy & super-medium segment shows a substantial recovery in active aircraft and number of flights flown. Analysis of activity for each helicopter operating in the offshore crew transfer fleet shows a net year-on-year improvement of 5% in the active fleet of aircraft. . .
Jul 11, 2022
There’s an Easier Way to Win in Alternatives: Betting on small funds over large managers gives investors better odds of outperformance, writes columnist Chris Schelling.
With retail investors joining the tide of capital flowing into the largest managers, investing in private equity is about to get even more competitive. But it’s still possible to win — if investors play the game right. . .
Jun 26, 2022
CBS's 60 Minutes aired a segment on fighting wildfires with helicopters. Along with windfarm construction, maintenance, and support, industry experts project firefighting helicopters as the fastest-growing demand for additional helicopters for the foreseeable future. . .
May 16, 2022
Highlights From "Fueling the Flames":
The First Street Foundation has expanded its portfolio of peer reviewed, property specific, climate adjusted physical risk models with the launch of the First Street Foundation Wildfire Model, estimating the risk of wildfire on a property-by-property basis across the United States today, and up to 30 years into the future. . .
. . . Supporting wildfire suppression at the local, state, and federal levels is among the most expensive wildfire protection efforts, costing the federal government $2.0 billion annually across the U.S. today. Recent estimates from OMB suggest those costs could rise to $2.83 billion under conservative climate change scenarios by 2050, and perhaps to as much as $4.32 billion under higher emissions scenarios (Office of Management and Budget, 2022). States and communities that are capable of suppressing most destructive wildfires today may find their resources stretched thinner and their capacity further challenged by climate-fueled increases in wildfire occurrence. . .
Apr 6, 2022
Offshore Rotorcraft - Time for Fleet Renewal?
Offshore crew transfer demand is expected to recover quickly in the oil and gas sector.
Is the industry ready with modern, safe and fit-for purpose solutions to accommodate growth? Is the wider energy industry really doing all it can in terms of maximising the safety of offshore personnel?
We take a look at fleet utilisation, spare capacity, and point to some potential areas for improvement in the offshore crew transfer industry. . .
Mar 14, 2022
Investors Haven’t Faced a Market Like This in Decades. Here’s How They’re Coping:
Investors have few places to hide in an increasingly volatile and risky market, experts say.
Volatility has effectively doubled since the beginning of January, with the Chicago Board Options Exchange’s CBOE Volatility Index hitting 32.78 by midday Monday. The last time the index reached these heights was ahead of the 2020 election, in October of that year. . .
Mar 9, 2022
Sikorsky stops taking S-76 orders; looks to license production:
Sikorsky will no longer be taking orders for the S-76D, following a period of low demand and high production costs that the manufacturer said made the type hard to build and deliver profitably. . .
Mar 4, 2022
The Aerial Firefighting Industry: A Voice in the Wilderness:
In January 2022, a critical U.S. federal government action relative to the wildfire crisis was announced amidst great fanfare, with multiple agencies joining a public relations blitz demonstrating that the feds were taking a bold step. A ten-year strategic plan for mitigating the wildfire crisis was released, entitled “Confronting the Wildfire Crisis: A Strategy for Protecting Communities and Improving Resilience in America’s Forests.” Like many fellow firefighters and aerial firefighting industry executives, at first glance, I applauded the mere fact that the 2020-2021 historic wildfires had prompted something as forward-looking as a ten-year plan. . .
Mar 3, 2022
US opens up offshore wind farm development with $4.37 billion sell-off:
The Department of the Interior announced the results of the nation’s highest-grossing competitive offshore energy lease sale in history, including oil and gas lease sales, with the New York Bight offshore wind sale. These results are a major milestone towards achieving the Biden-Harris administration’s goal of reaching 30 gigawatts of offshore wind energy by 2030. Today’s lease sale offered six lease areas totaling over 488,000 acres in the New York Bight for potential wind energy development and drew competitive winning bids from six companies totaling approximately $4.37 billion. . .
Feb 23, 2022
Number of wildfires to rise by 50% by 2100 and governments are not prepared, experts warn:
Climate change and land-use change are projected to make wildfires more frequent and intense, with a global increase of extreme fires of up to 14 per cent by 2030, 30 per cent by the end of 2050 and 50 per cent by the end of the century, according to a new report by the UN Environment Programme (UNEP) and GRID-Arendal.
The paper calls for a radical change in government spending on wildfires, shifting their investments from reaction and response to prevention and preparedness. . .
Dec 14, 2021
Wind power becomes Spain’s leading energy source for 2021:
Renewable sources already cover almost half of the country’s consumption needs – so far this year, they have contributed almost 47% of the total compared to less than 30% a decade ago. Even if the wind stops blowing in the next three weeks, wind power will end the year as the leading source of electricity in Spain. . . .
Dec 8, 2021
Helicopter Investor: LCI’s ‘marriage’, market prospects and ESG:
Last week's Helicopter Investor Virtual Summit began with LCI’s “marriage” to Nova Capital Aviation Ireland before considering the over supply in helicopters serving the oil and gas sector and environmental concerns. . .
Oct 15, 2021
Pulling the Goalie: Hockey and Investment Implications:
"As John Maynard Keynes pointed out, 'Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.' This applies to both coaching sports and portfolio management. . . .
". . .CIOs face this issue as well. If a portfolio is hammered by overexposure to equity risk in a crash, well, the market went down, what can you do? His investment team worked hard, but the markets didn’t roll their way this quarter (they failed conventionally), they’ll work even harder to get the breaks next quarter. But a CIO who chooses an alternative investment that disappoints will face sharp criticism, even if the portfolio now has a better expected long-term ratio of risk to return (and succeeds unconventionally)."
Sep 18, 2021
Zeroism and The Allocator Status Quo
Milton and Rose Friedman wrote The Tyranny of the Status Quo in 1984. The book examines “a political inertia characterized by ‘an iron triangle of beneficiaries, politicians, and bureaucrats’…in which special interests strive to maintain positions of privilege.”
Capital allocators (e.g., funds of funds, endowments, foundations, pensions, family offices) often succumb to a similar obstinacy when making manager selection decisions. Their version of inertia stems from a bureaucratic mix of incentives, process, and decision-making that combine to stifle creativity and limit outcomes. . .
Aug 14, 2021
[subscription required] As Electric Air Taxis Land on Stock Markets, Investors Need a Flight Guide. Investors may soon face a choice between first movers like Joby and more niche players such as Lilium and even air-ambulance startup Dufour: A few years ago most investors had never even heard of “air taxis.” Now they need to decide whether to board early movers with a high-altitude but low-definition view of the potential market, or else wait for the technology to land somewhere more specific. . .
Aug 9, 2021
Why two aircraft lessors have not jumped into the electric-aircraft craze: Some top aircraft lessors remain unconvinced about the viability of electric passenger aircraft and whether in-development air taxis and other first-generation electric types even fit within their leasing business models. . .
May 12, 2021
‘A huge moment’: U.S. gives go-ahead for its first major offshore wind farm: The U.S. offshore wind sector took a major step forward Tuesday after authorities gave the green light for the construction and operation of the 800 megawatt (MW) Vineyard Wind 1 project. . .
May 10, 2021
Life Flight Network’s Koalas in Montana - Life Flight Network’s Leonardo AW119Kx crews face some of the most challenging wilderness in the continental U.S.: A perfect example of the effectiveness of helicopters at saving lives in remote, high-altitude Montana hinterlands came in 2019 when a Life Flight Network helicopter emergency medical services (HEMS) crew was called into the Absaroka-Beartooth Wilderness. . .
Apr 21, 2021
McKinsey’s Private Markets Annual Review: Private markets rebounded in 2020 after a turbulent first half, but performance varied by investment type. Meanwhile, diversity and new ways of working are central to a changing business environment. . .
Mar 17, 2021
“They’re getting bigger, faster”: Colorado braces for what’s next after last year’s explosive wildfires: Federal forest firefighter Ben McLane got a visceral feel for the West’s intensifying wildfire predicament when his 20-man Hotshot crew rolled into Colorado last summer and faced the lightning-sparked Pine Gulch blaze — flames racing across bone-dry land and, each day, leaping beyond containment boundaries the firefighters hacked into soil. . .
Mar 16, 2021
Twin engine pre-owned helicopter sales to remain ‘bullish’: Aero Asset: The market for twin engine, pre-owned helicopter sales is likely to remain “bullish”, Valerie Pereira, Aero Asset vice president of Market Research has told Helicopter Investor. . .
Mar 9, 2021
Climate change complicates Colorado’s need for wildfire aircraft: When wildfires swept across Colorado and the western U.S. last summer and fall, water- and retardant-dropping airplanes and helicopters that can make the difference between a small blaze and a deadly megafire were difficult to come by. . .
Mar 1, 2021
USFS to contract for 48 Type 1 helicopters this year: The U.S. Forest Service (FS) is expecting to contract for 48 Type 1 helicopters for the 2021 wildfire season. These helicopters are the largest that are used for fighting wildfires and can carry between 700 and 3,000 gallons of water or fire retardant. . .
Dec 2, 2020
[We at Thora have been expressing many of the themes described in this article since our founding; framing our investment opportunity as: despite attractive potential risk-adjusted returns on capital, returns on labor units are less compelling. Contemplating the article has us rethinking directionality to: because returns on labor units are less compelling, potential risk-adjusted returns on capital are attractive.]
Why Modern Finance Is Ruining the World: There are plenty of investment opportunities to go around — yet investment professionals spend their time fighting over the limited alpha in tradable markets. . .
Jul 24, 2020
COVID-19 crisis could lead lessors to 50% fleet penetration: Way back in the dim, distant days at the start of the last expansion cycle, many commentators argued that commercial aircraft operating leasing – an increasingly popular form of aircraft finance for many airlines, and particularly beloved of the emergent low-cost airline sector – would inevitably achieve 50% penetration of the global fleet. . .
Jul 15, 2020
Black Hills Life Flight adds blood and plasma to emergency air medical transports: Air Methods, an air medical service provider in the U.S., announced that its Black Hills Life Flight base in Rapid City, South Dakota will carry blood and plasma on its missions to support improved outcomes for patients involved in traumatic injuries or other conditions that require transfusions. . .
May 3, 2020
Air ambulance calls increase amid COVID-19: There are typically about four calls for an air ambulance a day within the Nebraska and western Iowa territories that Air Methods covers.
That rarely includes more than one call from the same medical center.
That changed on April 14 as the company received four separate requests from CHI Health St. Francis in Grand Island for the transport of COVID-19 patients. . .
Apr 3, 2020
More (or less) oil on troubled waters: In the last couple of weeks, we have seen the commercial fixed wing industry brought to its knees by COVID-19, with almost 50% of the worldwide fleet currently parked and counting. Airlines are scrambling to navigate the inevitable financial implications, but what’s in store for the rotary sector? What we have observed is quite a stark difference in the behaviour of the two industries, which highlights that there are fundamentally different demand drivers at play. The rotary sector, so far and as a whole, has not yet seen a significant impact from the virus itself. . .
Mar 20, 2020
Air medical associations ask for relief for members during COVID-19 pandemic: The Association of Air Medical Services (AAMS) and Air Medical Operators Association (AMOA) are requesting specific forms of relief for their members as the critical care transport industry scrambles to respond to the COVID-19 pandemic. . .
Mar 18, 2020
The air in a plane is filtered and 99.97% sterile: According to the studies of the European Aviation Safety Agency the air in the aircraft is changed every 2-3 minutes and the filters it goes through are able to eliminate even coronavirus. . .
Mar 17, 2020
Will Covid-19 and Oil Price Cuts Send the Helicopter Market into a Spin?: The WHO has declared the spread of Coronavirus (Covid-19) a global pandemic and we are all bearing the brunt of an information overload from multiple sources via the media advising us how to live, work and travel. BA today announced it will cancel 75% of its flights with Easyjet grounding 100 of its 344 aircraft across Europe. Scheduled and charter fixed wing passenger flights the world over cannot operate. . .
Dec 1, 2018
**2019: The Year of Optimism, Growth for Helicopters: ** Next year looks to be one of resurgence of sorts for the global helicopter industry. . .
Nov 27, 2018
Aircraft Bonus Depreciation: The Tax Cuts and Jobs Act of 2017 (the “Tax Law”), permits qualified purchasers of new and pre-owned aircraft to elect, for the purchaser’s first year of ownership, to deduct from the purchaser’s gross income 100% of the purchaser’s basis in the aircraft (what we will call in this summary “Depreciation”). Notably, absent congressional action, this permitted deduction will shrink starting in 2023, dropping 20% each year for four years until it fully expires at the end of 2026. This summary provides a high level review of key considerations for purchasers seeking to take advantage of this new, larger deduction. . .
Nov 20, 2018
Commercial Rotorcraft Shipments up 10% Compared to 2017, GAMA Says: Shipments of commercial rotorcraft are up 10 percent compared to this time last year, the General Aviation Manufacturers Association (GAMA) said in its third-quarter shipments and billings report. . .
Nov 7, 2018
Bell bets on parapublic operators driving demand in China:
Bell Helicopters expects that reforms to lower airspace operating rules coupled with an expected rise in medevac operations will drive huge growth in the Chinese market in coming years. . .
Nov 6, 2018
Airbus, Leonardo See Great Potential in China’s Helicopter Market:
As U.S. and European helicopter industry players attend the biennial China International Aviation and Aerospace Exhibition this week in Zhuhai in Guangdong Province, Airbus is highlighting the significant potential it sees in the burgeoning Chinese civil helicopter market. . .
Oct 17, 2018
Offshore helicopter industry sees annual spend increase for first time in 4 years: This year will see an increase in annual expenditure in offshore helicopter services for the first time in four years, according to new analysis unveiled during a conference session at Helitech International 2018 in Amsterdam, the Netherlands. . .
Oct 16, 2018
‘Exponential growth’ provides opportunities in offshore wind sector: The global offshore wind market is experiencing “exponential growth,” presenting huge potential for enterprising helicopter operators, a sector specialist told seminar attendees at Helitech International 2018 in Amsterdam, the Netherlands. . .
Oct 3, 2018
H225 returning from the void: On 29 April 2016, an Airbus Helicopters H225 (LN-OJF) suffered a catastrophic gearbox failure, which caused the separation of the main rotor; all 13 passengers and crew aboard the aircraft were killed. . .
Sept 25, 2018
Evolving Helicopter EMS: The helicopter emergency medical services (HEMS) sector may not have the profit potential for operators of the offshore energy business, but it is steady work. . .
Sept 24, 2018
Airbus Projects $10 Billion Global Market For Wind Farm Helos
Airbus Helicopters projects a demand for up to 1,000 rotorcraft to serve offshore wind farms in the next 20 years, a market worth about 9 billion Euros, equivalent to more than $10.5 billion at the current exchange rate. . .
Aug 13, 2018
Urbane Urban Transportation: The sobering details of some air transportation theories presented from the likes of Uber — while exciting and intoxicating — require pragmatic review. . .
Aug 13, 2018
**Assessing Viability in Offshore Wind: **Helicopter operators target the offshore wind power industry as a new revenue stream. . .
Aug 1, 2018
Helicopter Market Outlook Still Strong in Latest Leonardo Report: Leonardo is seeing a recovery in the helicopter market on the heels of a strong first quarter, according to the manufacturer's earnings report of the first half of the year. . .
Jul 25, 2018
**Plasma during air transport may benefit those at risk for hemorrhagic shock: **The use of thawed plasma during prehospital air medical transport appeared safe and led to lower 30-day mortality than standard resuscitation among patients at risk for severe hemorrhage, according to results from the phase 3 Prehospital Air Medical Plasma, or PAMPer, clinical trial. . .
Jul 24, 2018
**Helicopters help power high-speed broadband in rural Alaska: **This summer, GCI-deployed specialty helicopters will make approximately 220 trips to remote towers in Western Alaska to ensure GCI’s TERRA network can deliver high-speed broadband to rural communities in the region for the next 18 months. . .
Jun 11, 2018
United's latest attempt to draw travelers to Newark: Helicopters: United Airlines has worked hard to convince travelers in the New York City area that the carrier's hub at Newark Liberty International Airport in New Jersey isn't that far away. . .
