Prudential Real Estate Investors has signed a 10-year joint venture deal with Mexican construction company Corporación GEO in a bid to target low-income residential development opportunities in the country.
The Parisippany, New Jersey-based firm is currently raising its latest residential fund targeting Latin America, PLA Residential Fund IV. According to regulatory filings PREI has raised $175 million to date. Predecessor funds focused solely on Mexico.
In a statement today, PREI said the joint venture expanded on an existing six-year relationship with GEO. Together the firms will buy raw land in a bid to improve it and sell onto other developers, as well as develop residential housing themselves.
PREI has already invested $440 million in 84 GEO land banks, 51 of which have been developed providing 70,000 homes. Another 17 are in the process of being developed and 16 are in reserve, the firm said.
The focus though will be on “megaprojects” in Mexico. PREI has invested $110 million in a 640-acre project at Valle de las Palmas in Tijuana, which will see 18,000 houses built, along with retail and industrial space.
Luis Abdeljalek, chief real estate officer of GEO, said investing in infrastructure was critical if large scale development projects in Mexico were to succeed.