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Loblaw Maple Leafs supermarket in downtown Toronto May 06, 2013. The grocery giant said Wednesday it is testing a new discount store in Calgary called The Box by No Frills.Fernando Morales/The Globe and Mail

A choppy stock market couldn't stop investors from ponying up cash to invest in Loblaw Cos.' new real estate investment trust.

Choice Properties REIT, which contains properties spun out of Loblaw, priced its IPO Tuesday at a 6.5 per cent yield, the high end of its marketing range. The total deal size could come in close to $500-million should the underwriters exercise the overallotment option.

Loblaw announced its plan to spin out real estate assets a few months back, but it took time to put together the IPO. Real estate markets then went on the rocks as soon as the company finally started marketing, and that raised questions as to how big the final deal size would be, and where it would price.

The question now is how the REIT will trade once the IPO closes. REITs closely track 10-year bond yields, and the U.S. 10-year Treasury yield jumped over 70 basis points in the past two months, sending many REIT prices plunging.

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