Prudential raises $175m for residential fund

Prudential Real Estate Investors is raising its fourth vehicle in the PLA Residential fund series, which have previously targeted Latin America. It comes as the PLA Fund III (Chile) fund buys an 18% stake in Chilean developer Paz Corp.

Prudential Real Estate Investors (PREI) has raised $175 million for its latest residential fund, according to regulatory filings.

The target for PLA Residential Fund IV was not disclosed, but the minimum investment is $25 million, the filings said.

The PLA opportunity fund series has previously focused on residential investments primarily in Latin America. PLA Residential III was believed to have targeted $400 million, while Fund II reportedly raised $280 million in 2005 and focused solely on Mexico.

It comes as Dow Jones reports that PLA Residential Fund III Chile has acquired an 18 percent stake in Chilean real estate developer Paz Corp.

Paz Corp said in a statement the deal will not be finalised until Prudential concludes its due diligence process, but added an agreement had been signed Friday with Familia Paz, four investment companies that currently control 59.2 percent of the developer. After the deal, Familia Paz will retain a 42 percent stake.

“Prudential is a strategic investor given the size of the fund and their expertise … it's too early to say what specific investment opportunities this will create (for Paz),” a person close to the operation was quoted as saying by Dow Jones.

Paz will issue 91.3 million new shares, and PLA Chile will subscribe 100 percent of the shares worth CLP200.00 (€0.27; $0.38) each.