PGIM closes Mexico fund on $235m

The firm closed the previous vehicle in the series, which had a narrower investment mandate, on $284.5m in 2010.

PGIM Real Estate has corralled 4.4 billion pesos ($235 million; €216 million) for its latest Mexico-focused fund, the Madison, New Jersey-firm said Thursday.

The firm plans to invest across different property types with the vehicle, PruMex IV CKD. Previously, the fund series focused on industrial real estate, with the third fund closing on $284.5 million in 2010. 

“PGIM Real Estate elected to invest in other asset classes for a more balanced risk approach and greater upside potential, and to capitalize on PGIM Real Estate’s expertise and platform access across different asset classes,” Alfonso Munk, PGIM Real Estate's Americas chief executive, told PERE.

Target investment markets for Fund IV include the Bajio-Central and north border regions for industrial real estate, and the Mexico City area for residential-for-sale, multifamily and mixed-use assets. PGIM Real Estate has not yet deployed capital for the vehicle, but Munk said the firm “has a strong pipeline of projects.”

The firm has been investing in Latin America since 2002 and had about $3 billion in gross assets under management in the region as of March 31. The firm started investing in Mexican multifamily assets in 2009.

“The strong market fundamentals in Mexico, including a growing middle class, competitive labor costs and manufacturing, and favorable housing policies and regulatory changes, continue to be the key drivers for the development of industrial and residential assets in the country,” Munk said in Thursday's statement.

PGIM Real Estate raised about half of Fund IV’s capital from existing investors and an unspecified GP co-investment, according to the statement. A spokesman for the firm declined to comment on Fund IV’s target returns or the fund series’ returns to date.

Overall, PGIM Real Estate had $66 billion in AUM as of December 31.