Hines and PGGM’s Milan value-add investment venture, together with a Savills Investment Management fund, has acquired a mixed-use asset home to one of Dolce & Gabbana’s first stores.

Invesco Real Estate said a property fund it manages in partnership with Thor Equities sold the 26 Via della Spiga in Milan’s fashion district for an undisclosed sum. 

New York-based investor Thor Equities bought the asset in November 2015, reportedly for €163m.

Hines said the 12,000sqm building will undergo a comprehensive renovation programme and will be transformed into a new luxury retail and office mixed-use building.

Dutch pension fund asset manager PGGM and real estate fund manager Hines entered into the joint venture in 2017 to target high-street retail, office and mixed-use value-add opportunities in Milan. The parties previously invested in a portfolio of three office buildings in late 2017.

Lars Huber, CEO of Hines Europe, said: “Hines and PGGM have a long-standing relationship, having been developing real estate together since the 1980s. PGGM is a trusted, highly respected partner and we are pleased to be extending our relationship through this deal.”

Mario Abbadessa, CEO of Hines Italy, said the acquisition allows us to invest into a prime asset in a historic luxury street of Milan that will benefit from a comprehensive revitalization plan.

“At Hines Italy, we continue to have confidence in the city of Milan, where we have long-time expertise and a solid track record. PGGM is an important investment partner of Hines with whom we truly enjoy working and we anticipate to continue co-investing in the future.”

Tinka Kleine, senior director private real estate for PGGM, said: “Milan has become part of our city focused investment program because it offers great investment opportunities, both for achieving attractive financial returns and for improving the sustainability performance of well-located assets.

”Hines’ expertise in executing this strategy is key for our successful partnership and we look forward to creating a great new destination in Via della Spiga.”