Palladius Capital Management (“Palladius”), a vertically-integrated real estate investment manager focused on pursuing multifamily, student housing, hospitality and select thematic investment strategies, today announced that it has ramped up its lending activity and is on pace to double origination volume year-over-year.
“While we have seen some stabilization in pricing as expectations for rate increases have moderated, opportunities for private lenders like Palladius remain very strong,” said Manish Shah, Senior Managing Director at Palladius. “The volume of borrowers seeking bridge and construction financing continues to exceed the capacity of regional banks allowing lenders to raise standards for sponsor and deal quality. With less financing competition and an increasing number of real estate investors needing to put their dry powder to work, we expect to our transaction volume to remain high for the remainder of the year and beyond.”
After deploying capital into more than $100 million in debt investments across property types in 2023, Palladius sees increased opportunities to provide flexible financing solutions across the capital stack in 2024. In addition to capitalizing on the significant pullback from regional banks and mortgage REITs, Palladius is benefiting from strong interest among sophisticated co-lenders who are actively seeking to invest alongside the firm.
These counterparties – many of which currently have limited capacity to structure and originate loans on a standalone basis – are choosing to partner with Palladius due to its track record, robust investment pipeline, and operational acumen. In particular, co-lenders view Palladius’ operating expertise as an important risk mitigator and competitive advantage in a market defined by uncertainty.
Through these co-investments, Palladius has been able to lead or participate in larger loan originations, providing the firm with enhanced flexibility. Palladius believes the commercial real estate market is ripe with opportunity for well-capitalized, operationally savvy lenders to earn equity-like returns at favorable positions in the capital stack.
Examples of Palladius’ recent debt investments include, but are not limited to:
- A $26 million loan on an approximately 214K square foot industrial facility in the Austin MSA;
- Two land loans along I-35 Austin-San Antonio Corridor to a leading global private real estate investment manager totaling approximately $15 million that will support multifamily and mixed-use developments; and
- Three loans with Choice Hotels, which are part of its programmatic lending partnership, to support the growth of the global hotel operator’s Everhome brand.
“We are seeing increased activity across our real estate credit platform. The in-bounds we are receiving are from institutional sponsors and independent developers who are seeking capital, as well as established non-bank lenders who are expressing interest in partnering with us,” said Nitin Chexal, CEO of Palladius. “This broad and sustained interest is being driven by our ability meet borrowers’ specific financing needs and our in-depth knowledge of different property types given our long history as equity investors. Considering our access to capital, proven underwriting process, and growing investment pipeline, we believe we are well positioned to put capital to work in a credit-challenged market.”
About Palladius Capital Management
Palladius is a diversified real estate investment manager that leverages institutional best practices, technology and operational expertise to drive value creation for institutional and individual investors. Led by a team of commercial real estate, finance, and corporate operations veterans, Palladius pursues value-add and core-plus strategies targeting multifamily, student housing, hospitality and other thematic investment strategies through its affiliates. Palladius also originates debt investments through its non-traded REIT, Palladius Income Fund. Based in Austin, TX, Palladius manages and operates approximately $800 million of real estate across the U.S. and is focused on building a highly progressive platform that promotes diversity and inclusion. To learn more, visit www.palladius.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240418500251/en/
Contacts
Media
ICRPalladius@icrinc.com
