News & Research - Paladin Realty Partners

Paladin Realty Acquires a 116-Unit Value-Added Apartment Portfolio in Azusa, CA in Partnership with Two Institutional Investors

September 19, 2022

A partnership sponsored by Paladin Realty Partners, LLC has acquired a portfolio of three 1960’s-vintage apartment properties totaling 116 units. These garden style assets are located near each other in the City of Azusa, a desirable working class/middle-class suburb of Los Angeles situated strategically at the intersection of the 210 and 605 freeways, as well as the Gold Line regional light rail system, a short distance east of downtown Los Angles and Pasadena. Paladin intends to pursue a value-added business plan to upgrade and modernize these assets and optimize their operations.

Paladin Realty Certifies World’s First Zero Carbon Project under International Finance Corporation’s “EDGE” Program

January 12, 2022

Paladin Realty Partners proudly announced that it has certified the world’s first zero carbon residential project under the International Finance Corporation’s (IFC) Excellence in Design for Greater Efficiencies (EDGE) program. Since 2018, Paladin Realty has certified 17 residential projects consisting of 5,639 units in Brazil, Mexico, Colombia, Peru and Costa Rica all saving greater than 20% in water, energy and embodied energy in materials. In February 2021, the IFC named Paladin Realty as an EDGE Champion in recognition of its standout certification efforts.

Paladin Realty Closes on R$337 million for Brazilian REIT Targeting Boutique Office Development in São Paulo

June 7, 2021

Paladin Realty Partners, LLC, a leading real estate investment fund manager focused on the Americas, has had a successful R$337 million first closing of a Brazilian Fundo de Investimento Imobiliario (“FII”, a fund similar to a U.S. REIT) for the development of boutique office buildings in the prime supply-constrained submarkets of São Paulo. In partnership with investment firm Hedge Investimentos and local developer Idea Zarvos, Paladin’s São Paulo-based team will be executing the development strategy, taking advantage of the recovery of São Paulo’s office market and trends that favor smaller office buildings in prime submarkets. The first four development sites are located in the submarkets of Itaim, Pinheiros, Paulista and Jardins, which have vacancy rates in the range of 5-10%, compared with 24% for the city’s overall Class A market. Paladin and Idea Zarvos have been partners since 2014, developing for-sale residential projects as well as purpose-built rental apartment building in São Paulo.

Latin American Housing Sales Boom in 2020, Despite Pandemic

March 29, 2021

It was French writer Jean-Baptiste Alphonse Karr that said more than 250 years ago, “the more things change, the more they stay the same.” It was fascinating to watch that in 2020, a year where the whole world changed, one thing certainly remained the same: demand for housing in Latin America, especially in the low-income segments. The combination of huge existing housing deficits, incremental demand outpacing supply by large margins, affordability with long-term mortgages at historically low rates, and government support, continue to buoy this market through the most challenging of times. For-sale housing has been the cornerstone of Paladin Realty’s Latin American investment strategy since it entered the market in 1998, for exactly these reasons.

In Brazil, a new record was set in 2020 for residential sales in São Paulo. According to SECOVI (one of the principal sources of residential sales data in Brazil), 51,417 units were sold in Brazil’s largest city in 2020, setting an all-time record. This figure was 5% higher than the previous record of 49,244 units, set in 2019. Some of the purchasing may have been investors searching for hard assets amidst the economic uncertainty and record-low interest rates, but much of it speaks to the demand-driven opportunity that housing presents: Brazil is a country that requires an estimated 1.5 million new housing units per year, which is met with a supply that is estimated at less than 500,000 homes. Paladin Realty launched Praça Marajoara in September 2020, a lower-income development with an average price-point of US$85,000, and had sold 66% of its 204 units by year end. Paladin’s prior two launches in São Paulo, ARQ, a middle-income project in Vila Mariana and CORE a mixed-use project in Pinheiros, ended 2020 with 71% and 99% of their residential units sold, respectively.

Paladin Realty Invited by IFC to be an “EDGE Champion” – Recognized as a Leader in Sustainable Housing in Latin America

February 25, 2021

Paladin Realty Partners has been invited by the International Finance Corporation (“IFC”) to be an EDGE Champion in recognition of Paladin’s more than two decades of leadership in accelerating the adoption of international green building best practices for housing throughout Latin America.

The IFC’s Excellence in Design for Greater Efficiencies (EDGE) program was established to help developers design, build, and certify projects that achieve a minimum of 20% savings in water, energy, and embodied energy in materials. Paladin has been working with the EDGE program since 2018 when it certified its first low-income project in the greater metropolitan area of Mexico City, “Villas del Fresno”, a 1,639-unit project which is currently the largest EDGE-certified affordable housing project in the Western Hemisphere. The project will save an estimated 1,300 tons of CO2 from entering the atmosphere each year as well as saving 28% in energy, 24% in water and a savings of 74% in embodied energy in materials compared to conventional building.

Paladin U.S. Research – California Residential Rental Regulations

October 2, 2020

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.

Paladin Realty Pioneering the Development of Purpose-Built Rental Apartments in São Paulo, Brazil

May 4, 2020

Paladin Realty Partners, LLC, a leading real estate investment fund manager focused on Latin America, has announced a new programmatic joint venture to develop a portfolio of purpose-built rental apartment properties in São Paulo, Brazil. The venture has initially committed in excess of R$130 million to capitalize its first projects, with the intention of increasing the size of the program as more sites are identified. While more than 40% of households in São Paulo are believed to be renters, there are few purpose-built, institutional quality apartment buildings due to a historical lack of debt financing and other factors. As a result, the existing rental market is comprised largely of “mom and pop” landlords who may rent one or two condominiums, providing a compelling market opportunity for well capitalized institutional investors to build and operate a portfolio of purpose-built rental apartment buildings. With a population of over 20 million, São Paulo represents an ideal market to launch the venture’s strategy.

International Finance Corporation: Green Buildings Finance on the Rise: Investing in Mexico

December 4, 2019

Santiago Gil, Managing Director and Mexico country head at Paladin Realty, was recently featured in a video produced by the International Finance Corporation “IFC”, highlighting the rise of finance for “green building” in Mexico.

International Finance Corporation VIDEO

Paladin Realty Announces New Joint Venture with Ambientti to Develop Low and Middle-Income Housing in Bogota

September 3, 2019

Paladin Realty Partners, LLC, a leading real estate investment fund manager focused on Latin America, announced a homebuilding joint venture with local partner, Ambientti S.A. The joint venture will focus on providing low and middle-income housing in and around Bogota. Ambientti is a vertically integrated developer founded in 1999 with a track record of nearly 40 projects totaling approximately 6,000 housing units.

“We are pleased to announce our partnership with Ambientti, a well-established and highly regarded developer in Colombia,” said Alejandro (Alex) Krell, Managing Director and Head of the Andean region at Paladin Realty. “We look forward to launching our first project before year-end and believe it will be the first of many”.

Paladin Realty Certifies Homebuilding Projects in Brazil and Peru with IFC’s Excellence in Design for Greater Efficiencies (“EDGE”) Certification

July 29, 2019

Paladin Realty announced today it has received the International Finance Corporations “EDGE” certifications for two more of its homebuilding projects in Latin America. The first project, Bosque da Serra, is a 964-unit low-income development in São Paulo which has certified savings of 21% in energy, 26% in water and 71% less embodied energy in materials compared to the average local project. The second project certified is a 429-unit middle-income development in Lima. The project has certified savings of 28% in energy, 48% in water, and embodied energy savings of between 47% to 64% compared to the average local comparable project.

Jim Worms, Paladin’s CEO, said, “as we continue to push for greener construction and more sustainable building practices, we are grateful to be recognized by the IFC for these accomplishments. The IFC has created a user-friendly, cost effective green benchmarking tool that we intend to utilize as much as possible in our residential development business in Latin America”.