Aircraft Orders & Deliveries
Falko Secures US$672M Financing for Regional Aircraft Fund II
Falko closes a US$672 million financing facility to refinance debt for its Regional Aircraft Opportunities Fund II, backed by 68 aircraft.
This article summarizes reporting by AviTrader and Heike Tamm.
Falko Regional Aircraft Limited, a leading asset manager specializing in the regional Commercial-Aircraft sector, has successfully closed a significant financing facility valued at US$672 million. According to reporting by AviTrader, the transaction was finalized in December 2025 and is intended to refinance existing debt within the Falko Regional Aircraft Opportunities Fund II (Fund II).
The deal underscores the continued financial viability of the regional aircraft market, specifically the 50–150 seat segment. As noted in the report by Heike Tamm, the facility is secured by a portfolio of 68 aircraft, providing a robust collateral base for the lending consortium.
The US$672 million facility involves a syndicate of major global financial institutions, highlighting strong market confidence in Falko’s asset management strategy. Based on data regarding the deal structure, the lead arrangers and structuring agents included:
According to the coverage, the primary purpose of this capital injection is to refinance existing debt facilities associated with Fund II. This move optimizes the capital structure of the fund, which was originally launched in 2019 as a vintage buyout fund targeting regional aviation assets.
Falko’s Fund II is dedicated to the regional sector, a niche that has shown resilience amidst broader aviation supply chain constraints. While a specific itemized list of the 68 aircraft serving as collateral was not released, the fund’s strategy focuses on generating stable cash flows through operating leases.
Industry data indicates that the portfolio likely includes a mix of modern regional jets and turboprops. Common asset types in Falko’s broader management portfolio include Embraer E-Jets (E170/E175/E190/E195), Bombardier CRJ900s, and De Havilland Canada Dash 8-400 turboprops. These aircraft are typically leased to major flag carriers and regional operators globally, with recent activity involving carriers such as LOT Polish Airlines and Air Canada.
This financing event follows a major corporate transition for Falko. In December 2024, just prior to this deal, HPS Investment Partners, LLC completed its acquisition of Falko from Chorus Aviation Inc. The sale, valued at approximately US$1.9 billion, transferred Falko to HPS, a global credit investment firm with over $100 billion in assets under management. This change in ownership appears to have provided Falko with substantial backing to execute large-scale financial maneuvers like the Fund II refinancing.
The Resilience of Regional Aviation The successful closure of a US$672 million facility with top-tier banks suggests that the financial markets view regional aviation assets as a stable, bankable asset class. Despite the volatility often seen in the widebody market, the 50–150 seat segment remains vital for connecting secondary cities to major hubs.
We observe that persistent delivery delays from major manufacturers like Boeing and Airbus have forced airlines to extend leases on existing aircraft. This dynamic keeps utilization rates and lease rates high for mid-life regional jets. For lessors like Falko, this supply shortage creates a favorable environment for refinancing, as the underlying asset values remain robust due to high demand.
What is the Falko Regional Aircraft Opportunities Fund II? Who are the lenders for this facility? What assets secure the loan?
Falko Secures US$672 Million Financing for Regional Aircraft Fund II
Transaction Details and Lenders
Fund II Portfolio and Strategy
Corporate Ownership Context
AirPro News Analysis
Frequently Asked Questions
Fund II is a vintage buyout fund launched by Falko in 2019. It targets investments in the regional aircraft sector, specifically aircraft with 50 to 150 seats.
The facility was arranged by a consortium including Citibank, Deutsche Bank, Goldman Sachs, Bank of America, and Royal Bank of Canada.
The US$672 million facility is secured by a portfolio of 68 regional aircraft managed under Fund II.
Sources
Photo Credit: Montage