REAL ESTATE- Pramerica Real Estate Investors has established a joint venture for the first time with ProLogis to develop industrial properties near Denver in Colorado.
Pramerica made a $40m (€31m) investment in the venture, which gets the pension fund manager a 50% interest in two industrial parks.
The assets involved are the 159-acre ProLogis Park 70 and the 295-acre EastGate development. Pramerica made the investment for its commingled fund, Prudential Real Estate Separate Account (PRISA).
The formation of the joint venture was first considered in 2004. The assets were then owned by Catellus Development Corp. and Pramerica became interested in those assets at that time.
The real estate manager liked the location of the two assets. Vice president Collete English Dixon said: “We think that being at an intersection of Interstate Highway 70 and E-470 is a major benefit. Also, we view Denver as a solid regional distribution hub for many companies.”
Pramerica put this investment into a core commingled fund because one day they will be core assets. Dixon said, “These assets are not core now, but they will become core assets once they are developed and leased.”
The assets were acquired by ProLogis when it purchased Catellus Development last fall for $5.5 billion. Pramerica was still interested in buying the assets.
ProLogis were also looking to sell. Its Corporate Communications Spokesperson Jessica Neal said, “We look at Denver as a regional distribution hub and through the purchase of Catellus we had doubled our land position in the market. It was our intent to reduce our exposure in the Denver region.”