Pramerica, Local Shopping REIT in UK property JV
* JV to invest up to 100 mln stg in UK retail property
* Eyes rental, value growth in neighbourhood properties
LONDON, Nov 29 (Reuters) - Pramerica Real Estate Investors (PRU.N) and Local Shopping REIT (LSR.L) have entered a joint venture to invest up to 100 million pounds ($156 million) in retail properties in the UK, targeting sector rental recovery.
The venture will focus on UK neighbourhood and convenience retail properties, priced from 1.25 to 7 million pounds each, with the potential for rental and value growth through active asset management, the companies said in a statement on Monday.
Pramerica, a unit of U.S.-based Prudential Financial, is committing 30 million pounds in equity to the joint venture, with LSR adding 7.5 million, totalling 37.5 million pounds in equity before leverage.
The deal comes as the outlook for Britain's retail sector remains uncertain, a survey earlier this month showing sales are likely to rise 1 percent this Christmas, but could fall in 2011 as shoppers face higher taxes and public spending cuts. [ID:nLDE6A7113]
The venture, which will have an expected duration of five years, is structured so LSR and Pramerica act as co-investors, with LSR also acting as manager responsible for sourcing the investments, the statement said. (Reporting by Daryl Loo; Editing by Andrew Macdonald) ($1=.6413 Pound) (See www.reutersrealestate.com for the global service for real estate professionals from Reuters)