Dawnay Day tests market

British property and financial services group Dawnay Day is setting up a company that will invest close to 1.27bn euros in the markets of Central and Eastern Europe, the Financial Times reported on Tuesday. Dawnay Day Carpathian (DDC), which is part of the group, will first raise 250 million euros by listing on the London Stock Exchange. The target for these funds will be retail property in Romania, Poland, Czech Republic, Hungary, Bulgaria, Slovakia and Croatia. Yields are relatively high in these countries compared with traditional markets, such as the UK or France, where prices have gone up amid the soaring demand for commercial property, the Financial Times article explains. The Dawnay Day group has around 2.5bn eurosa?? worth of property in the UK and Europe, representing over 500 buildings. DDC intends to buy shopping centres, supermarkets and retail warehousing. It has set a target for total compound return of more than 25% a year on invested funds. Dawnay Day said the enlargement of the European Union, combined with economic growth in the region, would lead to greater demand for commercial property. The Eastern European market, Romania included, has recently witnessed a storm of foreign investors lured by the relatively quick returns on investment. ZF