MADRID, March 31 (Reuters) - A new Spanish real estate investment vehicle, Merlin Properties, said on Monday it was looking to raise funds though a stock exchange listing, a model that is becoming increasingly popular as a potential revival in the country's property market attracts foreign investors.

Merlin, which will be managed by a team from local investment firm Magic Real Estate, said in a statement it had appointed Credit Suisse to coordinate the flotation, while Deutsche Bank and UBS will also be joint bookrunners.

Real estate investment trusts (REITs), or SOCIMIs in Spanish - listed vehicles that usually invest in income producing assets - are only just taking off in Spain, where the government introduced new rules in the rental market and improved tax incentives for investors. ID:nL5N0LI4RK

Hispania HIS.MC and Lar Espana Real Estate LRES.MC raised 950 million euros ($1.3 billion) between them earlier this year, in the first major listings of their kind. They attracted investors such as U.S. billionaire George Soros and bond fund manager Pimco.

Property prices in Spain are still falling after a real estate boom turned to bust, slumping about 40 percent since a 2007 peak. But experts believe they are close to turning the corner, at least in big cities such as Madrid and Barcelona.

Sareb, a "bad bank" launched last year to house the undeveloped land, unfinished housing blocks and other troubled assets taken off bailed out Spanish banks, also said last week that prices were stabilising. ID:nL5N0MO494

Merlin said it aimed to become the biggest listed property vehicle in Spain by market value. It will use the funds raised to buy a portfolio of Spanish rental properties, as well as commercial properties in the country and in Portugal.

The Lar vehicle last week made its first purchase, of two shopping centres in northern Spain.

Magic Real Estate, which had 2.8 billion euros under management at the end of last year, was set up in 2012 by Ismael Clemente and Miguel Ollero, who previously worked at Deutsche Bank's property unit in Spain, RREEF.

Magic is in talks with nationalised Catalunya Banc over the acquisition of its property management unit, sources familiar with the situation have told Reuters. ID:nL6N0M94HG

David Brush, also formerly of Deutsche Bank's RREEF and who until recently ran property investment in Europe for Brookfield Asset Management, will be chief investment officer for Merlin, the company said.

($1=0.7271 euros)

(Reporting by Andres Gonzalez and Sarah White; Editing by Greg Mahlich)

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Keywords: SPAIN PROPERTY/