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Paladin forms new Colombian JV

The Los Angeles-based investment fund manager has formed a partnership focused on low-income housing in the greater Bogota area.

Paladin Realty Partners has established a new partnership with Organizacíon Constructora Construmax, a Colombian housing developer that has completed 89 projects totaling approximately 8,500 units during its 36-year history. The two parties together have formed a new residential joint venture focused on building low-income housing in the area in and around Bogota, the country’s capital and largest city.

The joint venture – in which Paladin has made a $9 million equity investment – is intended to develop a portfolio of low-income, for-sale residential projects totaling approximately 1,300 units in Bogota and its surrounding municipalities. The developments are expected to generate more than $40 million in sales revenue.

“We are very pleased to partner with Construmax on this new joint venture,” said Alejandro Krell, managing director of Paladin Realty and head of its investment activities in South America outside of Brazil. “Colombia continues to show economic resilience and this continued prosperity has increased the need for new housing developments, particularly in the low-income segment. We believe partnering with such an experienced company as Construmax is a great way to help fulfill some of that demand and provide strong risk-adjusted returns for our investors.”

Construmax marks Paladin’s fourth programmatic joint venture in Colombia to date, and its latest investment on behalf of its fifth Latin American real estate fund, Paladin Realty Latin America Investors V. The Los Angeles-based firm entered the market in 2012, with the formation of Pali-Trocha, a homebuilding platform based in Bogota. The platform – an investment through its third Latin American real estate fund, Paladin Realty Latin America Investors III – was launched in partnership with La Trocha, a local family development firm focusing on housing and commercial projects in the city’s upper income neighborhoods.

To date, Paladin has deployed a total of $46 million of equity in investments in Colombia. Founded in 1995, the firm targets real estate investments in Brazil, Mexico, Colombia, Peru, Chile and other select markets in Latin America.