Pramerica raises EUR 182m for European real estate debt strategy

Pramerica Real Estate has secured £150 mln (EUR 182 mln) for its European real estate debt strategy. This sum includes capital from a pension fund serviced by APG, the Dutch pension fund manager with more than EUR 240 bn of assets under management.

The European debt platform will look to invest the discretionary capital, and any additional funds committed to the strategy, in directly originated real estate mezzanine finance and debt-like preferred equity opportunities, primarily in the UK and Germany. The portfolio management team, led by managing directors Andrew Radkiewicz and Andrew Macland, will focus on growing opportunities in areas of financing not being catered for by banks and other senior lenders.

The dramatic shortage of debt capital in the commercial real estate markets has created significant borrower demand in the short term, which we expect will increase and endure as the markets evolve in the face of looming capital shortfalls,' said Jack Taylor, managing director and head of Pramerica's global high yield debt initiative. 'Our global platform can help fill the void, with an initial focus on Europe and the US.'

The strategy will target borrowers that are looking to finance acquisitions of between £10-300 mln. It will also work with banks and other institutions on refinancing existing borrowings, as well as restructuring performing loans which require an injection of further capital.

Pramerica is the real estate investment and advisory business of New York-listed Prudential Financial. APG was created in 2008 when ABP, the EUR 180 bn Dutch pension fund for government and the educational sector, spun off its management unit. ABP is the sole shareholder and largest client of APG, but APG can also invest for other pension funds.