BOCA RATON, FLA. - Despite the negative headlines surrounding the commercial airline industry, the pooled aircraft lease ABS sector is heating up, as evidenced by the pricing of recent transactions as well as one transaction scheduled for later this year. In anticipation of the pending supply, fresh money is coming into the sector from hedge funds and private equity, even though rising fuel costs and labor difficulties threaten to send more commercial airline carriers into bankruptcy.

Recent pooled lease transactions from Bombardier, Debis AirFinance, RASPRO and the planned offering from Aviation Capital Group have offered fresh price discovery that is bringing in the distressed outstanding pre-Sept. 11, 2001 deals across the board. The fact that, amid numerous downgrades, these transactions continue performing has yield-hungry investors giving aircraft ABS a closer look - and further tightening is expected.

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