The AIM-listed company Atlas Estates has formed a 50:50 partnership with EDR Real Estate to undertake development projects in Central and Eastern Europe.

EDR is a real estate fund operated by the property division of the Edmond de Rothschild Private Equity Management. The joint venture will invest mostly in residential projects, providing 50% equity each, and will seek an internal rate of return (IRR) of more than 20%.

The JV has bought its first project to be carried out by the partnership which is a residential development opportunity in Mokotow, central Warsaw. It has bought a 3,000 sq m plot near Arkadia’s Galeria Mokotow for €6.5m (£4.4m). Atlas has sought a change of zoning from office development to residential use from Warsaw city council.

Atlas will manage the development of any project undertaken by the JV and will receive a management fee. It will also receive a performance fee if the agreed IRR threshold is exceeded.

It is a non-exclusive partnership and both parties are free to carry out other projects.

Quentin Spicer, chairman at Atlas Estates said: ‘This joint venture agreement with EDR is the first step for Atlas as part of a strategy to team up with major institutions operating in the CEE region and is a positive move for Atlas.’