Prelios, UBS devise fund-of-funds solution for Italian investors

ITALY – Prelios SGR and UBS Global Asset Management have joined forces to provide real estate fund-of-funds solutions to Italian institutional investors.

The Italian fund management house and UBS GAM's property multi-manager arm both intend to capitalise on the trend among Italian institutions to diversify outside their domestic real estate market.

Prelios SGR, the institutional fund management arm of Italian listed property company Prelios, will manage and raise capital for the fund of funds.

UBS GAM will act as investment adviser through its multi-manager business headed by Eric Byrne.

The joint venture follows the launch of a pan-European real estate fund for Italian investors by AXA Real Estate, which raised more than €200m.

Both are designed to capture new appetite among Italian institutions for overseas real estate, but, unlike AXA Real Estate, whose fund invests directly in buildings, Prelios has opted for an indirect approach.

"The decision to focus on an indirect strategy is based on the advantages that this type of solution offers," Prelios said in a statement.

In a separate statement, UBS GAM said the agreement would enable Italian investors "to diversify their real estate allocation abroad in a time-efficient manner".

The agreement with Prelios follows the promotion of Eric Byrne last month from COO to chief executive at UBS GAM's real estate multi-manager arm, replacing Roddy Sloan, who founded the section of the business.

Prelios itself underwent a change of management last month, appointing Sergio Iasi as chief executive, Giorgio Bruno as chairman and Massimo Caputi as deputy chairman.

The company, listed on the Italian stock exchange and owner of Prelios SGR, has undergone a restructuring of its debt and last week announced that it would issue a €269m convertible bond.

Paolo Scordino, who was appointed chief executive at Prologis SGR in April, said "the two businesses complement each other well".

He added: "While UBS Global Asset Management possesses a strong global real estate platform with significant access to international markets, Prelios SGR is a leading asset manager with an unrivalled contact base with Italian investors."