Offering Highlights
- Diversified real estate fund capitalizing on Paladin Realty's institutional competitive advantages in a profitable "mom and pop” market segment.
- Value-added repositioning of older “Class B” and “Class C” apartments in Southern California.
- Recession-resilient strategy targeting high demand for workforce housing in a chronically supply-constrained gateway market.
- Five unique, defensive and structurally embedded market attributes that offer asymmetrical returns
- Optimal timing to buy with $15bn of apartment loans maturing in a high interest rate environment.
- Conservative deal capitalization (fixed rate debt ~50% of cost) with strong downside protection
- 4-5 year expected holding period for each property
- Institutional RIA sponsor with proven 30-year track record (90 assets; 15,000 units; 26% IRR).
- Fees do not commence until properties are acquired (no "J-curve")
- Target returns: (1) 5-10% annual stabilized cash distributions; (2) 13-15% IRRs, net to investors
- ACT NOW and receive preferential terms (a higher 9% preferred return)
90
Assets
15,279
Units
$800m
Value of Apartment Assets Acquired
30+
Years of Investing
21%
Average Annual Return Net to Investors
An Investment That'll Last
Our focus in hidden trends combined with a disciplined investment strategy brings clients an institutional-quality investment for high net worth investors.
Buying from a fragmented pool of “mom & pop” owners…
- Small mom & pop owners have a totally different mindset than institutional capital
- Lack the resources and desire to invest in capital improvements and maximize value
- Keep rents low and minimize unit turnover for uninterrupted cash flow
- Complex and intimidating rent control regulations motivate many to sell
- Many will struggle to refinance their
existing debt at today’s high interest rates
…creates an abundance of value-added opportunities for savvy investors
- Thousands of under-performing Class B/C assets w/ fixable deferred maintenance
- Priced off today’s current income
- Existing rents 20-30% below market
- $15bn wave of maturing apartment debt; many owners will be forced to sell
- Moderate AB1482 rent control supports value-added business plans: A
- Raise rents to market upon vacancy
- Raise rents up to 10% annually
- Pathways for desired unit turnover
Our Core Fund Team
Jim Worms
Co-Founder, Chairman & CEO
Fred Gortner
Co-Founder, COO and Head of U.S. Strategy
Nickolas Gates
Vice President
Gisele Narisawa
Vice President of Finance