Pacific Investment Management Co.’s planned $1 billion initial public offering for a new real estate investment trust has been postponed for nearly a month without word on a potential reboot, but the Newport Beach investment giant is still keeping a close eye on real estate opportunities.
It’s looking a bit farther east than Wall Street for the deals, too, according to reports.
PIMCO reportedly struck a deal to buy four shopping center properties in the United Kingdom from Zurich Assurance Ltd. through a joint venture with London-based NewRiver REIT PLC. The venture has not been finalized and PIMCO declined to comment.
The properties, including three in Scotland and one on the Isle of Wight, are trading hands for about $76.3 million, according to news reports.
The venture between the NewRiver and Bravo Strategies III LLC, a fund managed by PIMCO, is exploring redeveloping the properties into alternative uses, according to a recent NewRiver statement, and aims “to quickly grow this portfolio,” said Chief Executive Allan Lockhart.
“The UK retail real estate market is starting to look attractive to new capital,” Lockhart said.
The dealmaking comes as values for U.K. retail property “have been plunging as retailers close stores and negotiate rent cuts in the face of growing competition from online commerce, rising wages and tax hikes,” Bloomberg noted.
IPO Hiatus
The dealmaking in the U.K. comes less than a month after PIMCO postponed plans to start its first real estate investment trust in the U.S. due to choppy returns for notable IPOs of late.
The money manager, which has $1.8 trillion assets under management, had filed to raise $1 billion by offering 50 million shares at a price of $20 for the REIT, called PIMCO Mortgage Income Trust.
Daniel H. Hyman, a managing director and co-head of the Agency Mortgage Portfolio Management team at PIMCO, would become chief investment officer at the REIT.
The IPO paperwork has not been formally withdrawn, but a time frame for moving ahead has not been disclosed.
