Key Takeaways
- • OakNorth deployed £50m in new funding to Paloma Capital, a leading private equity real estate investor, split across two separate transactions for deployment in Paloma Real Estate III.
- • Paloma Capital successfully completed a final close of Paloma Real Estate III at £201m in wholly discretionary equity, with the fund launched in November 2022 focused on income-producing multi-let urban industrial and logistics assets.
- • This represents a continuation of OakNorth's relationship with Paloma Capital, following a prior £45m facility provided in September 2023, demonstrating confidence in the fund's strategy and execution.
- • Paloma Capital, founded by Joe Froud and Jack Pitman, has accumulated over £520m in wholly discretionary capital across three value-add funds since 2015, primarily from institutional investors across the UK, Europe, and the Middle East.
- • The fund's investment thesis emphasizes three pillars: acute focus on mispricing, entrepreneurial capex-intensive asset management, and prioritization of income-generating returns, with asset types including urban logistics, trade counters, open storage, and self-storage.
Summary
OakNorth, the digital banking platform for entrepreneurs, has committed £50m in new funding to Paloma Capital, an established entrepreneurial private equity real estate investor. The capital, structured across two separate transactions, will be deployed within Paloma Real Estate III following the fund's successful final close at £201m in wholly discretionary equity. This transaction underscores OakNorth's expanding role in providing flexible, bespoke credit solutions to established alternative asset managers and demonstrates continued confidence in Paloma Capital's investment execution.
Paloma Capital, founded by Joe Froud and Jack Pitman, has positioned itself as a focused operator in value-add real estate. Since its inception in 2015, the firm has raised over £520m across three discretionary funds, attracting capital predominantly from institutional investors spanning the UK, Europe, and the Middle East. The firm's investment philosophy rests on three foundational pillars: identifying mispriced assets, deploying entrepreneurial approaches to capital-intensive asset management, and structuring portfolios to generate majority returns from income rather than appreciation. These characteristics align with institutional demand for yield-focused strategies in an elevated interest rate environment.
Paloma Real Estate III, launched in November 2022, has adopted an opportunistic strategy concentrated on income-producing, multi-let urban industrial and logistics assets across diverse geographies and property types. The fund's portfolio spans urban logistics facilities, trade counters, open storage, and self-storage schemes—asset classes that have demonstrated resilience and attractive risk-adjusted returns in recent years. The £50m commitment from OakNorth represents an expansion of their existing relationship; the bank previously provided £45m facility support in September 2023, indicating sustained partnership and confidence in fund performance.
Jack Pitman, Founding Partner of Paloma Capital, reiterated the firm's commitment to hands-on asset management and value creation through targeted business plan execution on multi-let properties. This capital infusion positions Paloma Real Estate III to continue its deployment strategy across its target markets during a period of selective opportunity in European real estate markets.
Paloma Capital, founded by Joe Froud and Jack Pitman, has positioned itself as a focused operator in value-add real estate. Since its inception in 2015, the firm has raised over £520m across three discretionary funds, attracting capital predominantly from institutional investors spanning the UK, Europe, and the Middle East. The firm's investment philosophy rests on three foundational pillars: identifying mispriced assets, deploying entrepreneurial approaches to capital-intensive asset management, and structuring portfolios to generate majority returns from income rather than appreciation. These characteristics align with institutional demand for yield-focused strategies in an elevated interest rate environment.
Paloma Real Estate III, launched in November 2022, has adopted an opportunistic strategy concentrated on income-producing, multi-let urban industrial and logistics assets across diverse geographies and property types. The fund's portfolio spans urban logistics facilities, trade counters, open storage, and self-storage schemes—asset classes that have demonstrated resilience and attractive risk-adjusted returns in recent years. The £50m commitment from OakNorth represents an expansion of their existing relationship; the bank previously provided £45m facility support in September 2023, indicating sustained partnership and confidence in fund performance.
Jack Pitman, Founding Partner of Paloma Capital, reiterated the firm's commitment to hands-on asset management and value creation through targeted business plan execution on multi-let properties. This capital infusion positions Paloma Real Estate III to continue its deployment strategy across its target markets during a period of selective opportunity in European real estate markets.
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