UK - Prupim, the real estate division of UK life assurer Prudential, has executed a series of UK property derivatives valued at more than £100m (€110m).
The total return swaps, based on multiple UK International Property Databank (IPD) sub-sectors, were executed by the Royal Bank of Scotland (RBS) and with ICAP Property Derivatives acting as the broker.
Prupim has been trying to push forward the nascent property derivatives sector for some time and in December 2008 gave property derivatives director Will Robson the task of investigating new and efficient ways of utilising them. (See earlier IPE Real Estate story: PruPim arrival to make derivatives push)
"Prupim has completed the largest series of sub-sector property derivative transactions ever as part of a portfolio rebalancing," said Robson.
"ICAP's focus on developing property end-user participation in this market has been particularly valuable in this process. We take the view that this kind of activity can be a valuable device in managing risk in an institutional commercial property portfolio."
Paul Rostas, head of property derivatives at ICAP, said: "We have long believed that property specialists and institutional investors will be even more attracted to the benefits of property derivatives as liquidity grows in the sub-sectors."