LONDON-The local office of Pramerica Real Estate Investors, asubsidiary of US-based Prudential Financial, has arranged $185million of institutional capital for European real estate debt. Theamount raised includes capital from a pension fund serviced by theNetherlands-based APG.

The fund will invest the discretionary capital, and anyadditional capital committed to the strategy, in directlyoriginated real estate mezzanine finance and debt-like preferredequity opportunities. The firm’s European arm has a strategy thatis part of a global initiative to provide institutional investorswith opportunities for real estate debt, a gap in the market toassist mid-size, high-quality private and public property companiesand funds, according to Jack Taylor, managing director atPramerica.

“The dramatic shortage of debt capital in the commercial realestate markets has created significant borrower demand in the shortterm, which we expect will increase and endure as the marketsevolve in the face of looming capital shortfalls,” Taylor said in astatement.