Pramerica and APG launch €265m Dutch debt fund

Dutch pension group APG and US real estate firm Pramerica have launched a €265 mln debt fund in the Netherlands.

PRECap V will build a mix of junior debt and preferred capital secured against commercial real estate in the Netherlands and partially in Belgium.

The fund will target an annual return of 7-8% and the loans will run for around five years.

'The Netherlands is at an attractive point in the cycle, earlier in the recovery phase than the UK, and there is less competition in the lending market compared to other countries,' said Andrew Radkiewicz, managing director of Europe at Pramerica.

APG's head of European property investments, Robert-Jan Foortse, said: 'The Dutch real estate market suffers from a funding gap, where the finance market remains tight and dislocated. At this moment, there is the opportunity in the Netherlands to provide junior debt and to capitalise on both acquisition as well as refinancing opportunities.'

Most of the capital for the PRECap V fund comes from APG, one of the world's largest pension fund managers with more more than €345 bn of assets under management.

Pramerica is the European real estate investment arm of NYSE-listed Prudential.

Pramerica's PRECap platform has invested more than €1.2 bn in loans to date, secured on €4.6 bn of European real estate.