By Aram Arkun
WATERTOWN – Peter Palandjian, the chief executive officer of Intercontinental Real Estate Corporation, spoke about his work and real estate at the November 2 St. James Armenian Church Men’s Club dinner meeting.
Prior to Palandjian’s talk, Men’s Club chairman Dick Janjigian introduced Hayk Demoyan, director of the Armenian Genocide Museum-Institute in Yerevan, who said a few words about his lecture the following day at the Armenian Cultural Foundation on Armenian sports and physical education in the Ottoman Empire.
Palandjian first acknowledged his mother and other family members in the audience, and then thanked Ira Stepanian, the retired chairman and CEO of the Bank of Boston, for “being like an uncle or a second father to me,” and mentoring him in his business for many years. Palandjian spent the first part of his lecture sketching out what he does in his company, then made some observations about the greater Boston real estate market, and ended with a market forecast.
Palandjian related that his father Petros came as an immigrant to Boston from Iran, and after graduating from Northeastern University, founded a construction company, called Cosmpolitan Construction in Boston and Yekan Construction in Iran and Lebanon. From 1959 to 1972 the family were builders in the US, and overseas served as the outsource contractor for A. J. Jones, a worldwide construction company. Petros built the Hilton in Tehran and the famous wall around the US embassy in Iran. In the 1970s he began developing — in addition to building, he put his own money and money from friends into projects.
This situation continued through the 1980s. In 1991, there was a great financial crisis in real estate. As a result, the family company owed a lot of money, but soon paid everything back without filing for bankruptcy. Peter and his brother Paul joined their father in 1993. Peter had graduated Harvard Business School, and previously worked as the assistant to the CEO of Staples. Inc., and as an associate consultant with Bain & Company.
Peter Palandjian decided he wanted to turn the main family business, by now called Intercontinental Real Estate Corporation, into the Bain of real estate.
Palandjian spoke about the types of property his funds buy, and how his company has become much more conservative, with less leverage and risk. His company has 90 employees, with the majority in Boston. His next push will be to allow people to have the option to invest in his real estate work through 401k funds.
Palandjian felt that the real estate market is still in its early legs, though others argue that pricing is already expensive. For this reason, his company either buys class A property in secondary markets, or class B (“tired, fatigued”) property in the most expensive markets, and then upgrade its quality. After his formal talk, Palandjian took a number of questions from the audience.