Modus hires advisers to prepare for £2bn REIT

Manchester-based developer Modus, headed by Brendad Flood, has hired accountant Grant Thornton and law firm Eversheds to prepare for the launch of a £2bn Real Estate Investment Trust with Corovest, its South African backer.

Flood said: "We are holding talks with Corovest about how to maximise the schemes we hold together and those that we have developed ourselves. This could potentially involve launching a REIT."

Modus's investment portfolio is valued at around £1.5bn and includes £460m of supermarkets, its £200m Alpha Fund and shopping centres including the recently redeveloped 425,000 sq ft Grand Arcade in Wigan and the 300,000 sq ft Hounds Hill in Blackpool, currently undergoing redevelopment.

Modus is not expected to launch the REIT, which trade on the stock market and allow wider access to investors, until 2008 due to the current falling investment market.

The UK REIT market is trading at a discount to the net asset value of the portfolios held.

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