Research

Any inquiries from the press should be directed to:


Evan Pickering
Vice President
(310) 996-8755
epickering@paladinrp.com

Paladin U.S. Research – California Residential Rental Regulations

Regulations affecting residential rental properties in California are varied and complex. Several current and proposed statewide and local ordinances will affect Paladin’s apartment investments in Southern California and, like the regulations themselves, the results will be varied and complex. On the one hand, Paladin believes these regulatory requirements and risks create additional stress on smaller “mom and pop” owners of apartments who may be ill-prepared to deal with these rules. As a result, many of these owners may decide to exit the market, providing investment opportunities for sophisticated investors who have more expertise underwriting and navigating such regulatory complexities. On the other hand, such regulations may reduce the potential returns from existing investments. Paladin believes that careful underwriting of the risks, along with the solid execution of value-added business plans to mitigate the effects, will continue to generate attractive risk-adjusted returns for our investors. Additionally, asset pricing will eventually adjust to reflect the realities and limitations of any such regulations.

 

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Latin America Research: 2019 Outlook – Macro & Property Trends

Latin America’s leading economies of Brazil, Mexico, Colombia, Peru and Chile continue to benefit from a convergence of long-term demographic, economic and political trends that are expected to support sustainable growth over the next several years. These positive long-term trends include attractive demographics, a growing middle-class, greater mortgage availability and large housing deficits, all factors which should continue to result in resilient demand for housing and the development of other real estate products. Political risk has receded in the region as newly elected market-friendly leaders prevail in Brazil, Colombia and Peru; some uncertainty remains in Mexico with questionable initial policies of its new President. Brazil’s economic and political outlook improved sharply in 2018 with the election of a pro-business President, who is already pursing a reform agenda. GDP is expected to grow in the 2%+ range in 2019 and beyond. Mexico and the three leading countries of the Andean region (Colombia, Peru and Chile) are each poised to grow 2-4% in 2019 and beyond, with economies increasingly driven by domestic consumption and intraregional trade. In Mexico, while the conclusion of NAFTA renegotiations in 2018 removed some uncertainty, the new President’s early actions have given mixed messages at best and Paladin remains cautious on Mexico until the new President’s policies become more clear and constructive.

 
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IREI In Focus: Randall Loker, CIO, on the Residential Real Estate Opportunity in Brazil

Loker_GRIRandall Loker, Chief Investment Officer at Paladin Realty Partners, discusses why Brazil’s demographics, economics, unemployment rate and more, make it a lucrative market to invest. (May 2018)

 
VIDEO LINK

2018 Investment Outlook – Brazil

Over the past few years, Brazil has weathered significant social, political and economic shocks, driven by both internal and external factors. The slowing of China’s economy and the end of the global commodities “super-cycle” boom in 2012 hit Brazil’s terms of trade hard, causing its currency to depreciate by nearly 70% from 2012 through 2015.  Lower commodity prices also strained the government’s finances, curtailing spending and precipitating the end of former President Dilma’s populist rule in 2016. Business and consumer confidence collapsed as the country entered its deepest recession on record, contracting by more than 7% in real terms during the 2015-16 period.  Fixed investment slowed.  Unemployment increased to over 10%.  Inflation hit double-digits in 2015 as imported goods were suddenly more expensive in local currency. Local interest rates increased to 14.25%.  International newspapers predicted that the 2016 Olympic Games in Rio would be a bust and that a mosquito-borne virus would wreak havoc on the country.  The country’s highly unpopular President Dilma was impeached and removed from office in 2016.

 
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Latin America Research: Brazil Political Risk

president-temer

A few weeks ago, on May 18th, as part of a plea bargain deal in Brazil’s ongoing Lava Jato corruption probe, the head of international food giant JBS released audio tapes in which Brazilian President Temer allegedly condoned the payment of hush money to former speaker of the house, Eduardo Cunha. The tapes would appear to implicate Temer in the far reaching political corruption scandals that have led to the removal and jailing of many high-ranking politicians and businessmen in Brazil. The Bovespa stock exchange dropped 10% the day the audio tapes were released, triggering circuit breakers halting all trading. Brazil’s currency also dropped by about 10%. While this new revelation will likely delay certain of Temer’s reform efforts in the short term, the overarching theme is that this continual rooting out of corruption bodes well for Brazil’s long-term future…

 
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PREA Interviews Fred Gortner

In February 2017, PREA interviewed Fred Gortner (Co-Founder and COO of Paladin Realty Partners LLC) to discuss real estate markets across Latin America.  Click on link below to see the video interview.

 

 
PREA VIDEO

Brazil: Poised for a Comeback?

Author: Denise DeChaine

The year 2016 was definitely one of transition for Brazil, a country once touted along with the other BRIC members as “the next big thing.” But emerging markets are not in favor currently, and Brazil has had a tough run for the past two years, according to Waiting for the other shoe to drop in Sao Paulo: Is 2017 the time to consider real estate investing

 
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Latin America Research: Brazil – Is Now the Time to Invest?

Over the past few years, Brazil has weathered significant social, political and economic shocks, driven by both internal and external factors. The slowing of China’s economy and the end of the global commodities “super-cycle” boom in 2012 hit Brazil’s terms of trade hard, causing its currency to depreciate by nearly 70% from 2012 through 2015. Lower commodity prices strained the government’s finances and exacerbated the budget deficit, leading to the loss of Brazil’s investment grade credit rating in 2015 and precipitating the end of Dilma’s populist rule. Business and consumer confidence collapsed as the country entered its deepest recession on record, contracting by more than 7% in real terms during the 2014-16 period. Fixed investment slowed. Unemployment increased to over 10%. Inflation hit double-digits, because imported goods were suddenly more expensive in local currency, and because the government rolled back price subsidies. Local interest rates increased even more to….

 
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Latin America Research: Putting Recent Headlines in Perspective

Over the past two decades, the thesis for Latin America real estate investment has undergone a dramatic transformation. When Paladin Realty first began investing throughout the region in the late 1990s, many markets were plagued by weak construction standards, poor infrastructure and corruption. Institutional-quality local operating partners were hard to come by, as was reliable market data. Further, while the region’s scale and attractive demographics offered the promise of superior economic gains, the structural reforms needed to….

 
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Two Paladin Funds Ranked Among Top 5 Perfoming Latin America Funds

preqinPaladin Realty’s Latin America investment funds business was ranked by Preqin among the “Top Five Performing Latin-America-Focused Closed-End Private Real Estate Funds” in its 2016 Preqin Alternative Assets Performance Monitor Report. Preqin (https://www.preqin.com) is a leading source of fund performance data for the alternative investments industry.

Paladin Realty has been investing throughout Latin America for nearly two decades, through numerous cycles and across $4 billion of assets.  The firm has regional offices located in Brazil, Mexico and the Andean region…

 
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