Team size: Three

Key team members: Julio Ortiz, managing director; Miguel Sierra, director legal counsel

What are the most significant private equity deals that you or your team have recently been involved in within the Latin American market?

As part of Yellowstone’s sustainable investment strategy, our team recently closed a significant investment in Hacienda El Otoño and Hacienda El Bosque, two prominent housing projects located within the Lagos de Torca Project; a large-scale sustainable residential development located in the northern area of Bogota, Colombia.

Yellowstone’s managed Funds invested nearly COP$467,616mn (approximately US$116mn) in both deals. These investments will lead to the development of more than 14,000 housing units, with an average breakdown of about 46-54 percent between non-affordable and affordable housing, respectively. The units will be built by Amarilo, one of Colombia’s leading and most reputable construction companies, replicating their successful “cities within a city” concept and following the best environmental practices of urban infrastructure development. This transaction also included the co-investment of the investing arm of Colombia’s largest bank in a structure led by Yellowstone.

In early 2023, we initiated the fundraising of our next private equity fund, achieving a remarkable milestone by securing capital commitments exceeding US$475mn from institutional investors even before the first closing. With this new fund, our plan is to advance further our ESG-driven sustainable real estate investment strategy in alliance with leading institutional real estate developers and partners.

Latin American markets vary widely in terms of economic stability and political dynamics. How do you factor these considerations into your legal strategies and recommendations for private equity clients?

These factors are critical when considering a jurisdiction to invest in. We recommend focusing efforts on robust and resilient sectors of the economy and markets with a high level of institutionality, stable legal frameworks for investment protection (such as investor protections, international reporting standards, strong anti-corruption and money laundering prevention provisions, protection against expropriation, among others) and adequate “checks and balances” across the government branches. While these factors will not guarantee success, they will significantly mitigate unforeseen negative impacts on the portfolio.

Yellowstone’s investment strategy has proven to be an “all-weather strategy” regardless of the government’s political ideology and economic cycle, given that the construction industry, with housing as one of its main pillars, is one of the main drivers of the economic growth of any country, especially in those high growing markets with long-term structural government policies and stable legal frameworks.

What do you find most rewarding and challenging about working as an in-house lawyer specialising in private equity within the Latin American market?

Seeing the positive impact of our investments in the environment and the lives of so many people and communities while meeting the expectations of our investors is the most rewarding experience of working as an in-house lawyer at Yellowstone. Learning from amazing colleagues, developers, partners, and advisors with diverse backgrounds and careers across different industries has also been the most enriching experience for my professional career.

The most challenging yet equally rewarding experience is creating tailor-made legal structures and risk mitigation strategies for each deal that are not only aligned with our institutional standards and ESG-driven strategy but also with the stakeholders’ interests. We firmly believe that having a win-win approach and adequate alignment of interest mechanisms between the investors and the different stakeholders is key to successfully achieving sustainable returns on investments in the long-term.