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Macquarie Mexico IPO Offers REIT Where Murder Reigned

The biggest real-estate investment trust to go public in Mexico is staking its success on the city most ravaged by the nation’s drug war.

The 14.7 billion peso ($1.2 billion) initial public offering from Macquarie Group Ltd. is the first Mexican REIT to focus on northern Mexico, with the biggest share of its holdings in Juarez, where the homicide rate peaked at 230 per 100,000 residents in 2010, according to a prospectus. Macquarie Mexico Real Estate Management SA, which priced its IPO yesterday, will allocate 16 percent of its portfolio to Juarez, while 76 percent of the properties overall are in the northern border area used as a corridor for cocaine and marijuana shipments to the U.S.