Product Innovations Limited, a U.K. structured products boutique, launched a note linked to a basket of global real-estate investment trusts and indices last week. The basket consists of options on Japanese and North American REIT indices and the European Public Real Estate Association index. At the end of the six-year term, investors either receive full return of capital, or 110% of the upside of the basket.
Scott Levy, head of operations at Product Innvoations in London, said the group wanted to offer something different from the FTSE 100-linked investment notes which dominate the U.K. market. While it has offered EPRA-based notes before, this is its first venture into global property.
The underlying, however, made it challenging for the company to find a suitable counterparty, said Levy. Bank of Ireland was chosen as the capital guarantor and deposit taker because it was willing to price structures outside of traditional equity-linked notes. Levy said the group is looking to raise GBP4 million (USD 7.45 million) with the issue. Officials at Bank of Ireland did not respond to messages by press time and pricing details of the structure could not be determined.
