Prudential To Raise MXN6.5 Billion For Mexico Real Estate Fund
November 26 2009 - 3:16PM
Dow Jones News
The real estate investment subsidiary of Prudential Financial
Inc. (PRU) plans to raise about 6.5 billion pesos ($501 million) to
invest in Mexico's industrial property market through the listing
of an infrastructure trust on the local stock exchange.
The Prumex Industrial III fund will use the proceeds from the
listing to buy and develop industrial properties, the brokerage arm
of Mexico's No. 1 bank BBVA Bancomer, which is acting as the
placement agent in the deal, said in a press release Thursday.
Paulo Gomez, vice president of research and chief strategist for
Prudential Real Estate Investors Latin America, said in a telephone
interview that the fund plans to go to market during the next four
months, and aims to be fully invested over a five-year period.
The trust's objective is to reach an internal rate of return of
16% to 22%, and a yield of 8% to 12%, according to BBVA
Bancomer.
"Mexico's industrial [property] market is well positioned to
benefit from the coming economic recovery in the medium term,"
according to the press release.
Prudential Real Estate Investors, or PREI, manages a portfolio
of 152 industrial properties in Mexico through its PLA Industrial
Fund I and PLA Industrial Fund II, and also operates several funds
that invest in the residential real estate market.
PREI had about $7.8 billion in real estate assets under
management in Mexico, Brazil, Chile and Argentina at the end of
June.
Infrastructure trusts were launched earlier this year in Mexico
as a new asset class aimed at local institutional investors like
pension funds.
Mexican construction company Empresas ICA SAB (ICA) and Goldman
Sachs Infrastructure Partners listed the first such trust in early
October by selling MXN6.55 billion in tradable equity notes backed
by a toll-road concession.
By Ken Parks, Dow Jones Newswires, 52-55-5980-5177,
ken.parks@dowjones.com