MEXICO CITY -(Dow Jones)- 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
