Allianz Real Estate is selling a portfolio of 144 residential assets in Italy and is on the verge of inking the acquisition of a 4,000 m2 prime retail asset in Milan, PropertyEU has learned.
Allianz Real Estate is selling a portfolio of 144 residential assets in Italy and is on the verge of inking the acquisition of a 4,000 m2 prime retail asset in Milan, PropertyEU has learned.
According to well-informed market sources, US private equity firms TPG and Cerberus are currently in due diligence on the residential portfolio which includes 144 apartments located in a number of Italian cities.
Binding offers are expected by next month.
The disposal is part of Allianz's strategy to exit the low-yielding residential sector in Italy and increase its exposure to retail assets as well as real estate-secured debt in the country.
Commenting on the group's strategy in the country, Allianz's Italian head Mauro Montagner said last week during the Mipim fair: 'To increase the performance of our portfolio, we have initiated the disposal of our residential assets in the country and we are currently in advanced procedures.'
Nevertheless, the group has a 'clear strategy to grow in Italy', he added. 'The priority for us is to invest in the retail sector, either on the equity or the debt side,' he noted.
According to well-informed sources, the German property investor is also on the verge of acquiring a 4,000 m2 retail building at C.so Buenos Aires in Milan in a €50 mln off market deal with insurance giant Generali.
DEBT MOVE
Allianz Real Estate currently owns a €2.4 bn portfolio in Italy. Last year the company bought a majority share in the Fiumara shopping centre in Genoa as well as the Allianz tower in Milan's Citylife.
The company expects to enter the Italian real estate lending sector this year, Montagner said.
'The authorities in Italy have cleared the situation regarding lending by insurance companies and we plan to start being active in the debt market.'
Following changes last year to Italy's withholding tax system and property lending legislation, it is now possible and cost-efficient for insurance companies to lend directly in the country. Previously insurers could only do so through a separate specific structure, which often made the investment too costly.
'This is a great opportunity for us and for the Italian market,' Montagner commented.
RESIDENTIAL PACKAGE
If successful, the acquisition of Allianz's residential package would be the first by TPG in Italy.
Cerberus, on the other hand, has been actively buying assets in the country for nearly a year. The US private equity firm made its first foray in July 2014 with the purchase of a portfolio of seven office buildings and barracks held by the Patrimonio Uno closed-end fund managed by BNP Paribas REIM.
It bought the assets - located in Senigallia, Pescara, Padoa, Mestre, Florence, Vicenza and Genoa - for some €90 mln on behalf of the C1 Investment Fund managed by Cordea Savills Sgr, as tipped by PropertyEU at the time.
PropertyEU understands that Cerberus is currently in the process of acquiring the Levia portfolio of Italian real estate assets from lender Unicredit at a discount of nearly 50%. It is also believed to be in final negotiations with Fondi Immobili Pubblici (FIP), a state-owned fund managed by Investire Immobiliare Sgr, to buy a sub-portfolio consisting of three army barracks in Bari, Rome and Bergamo as well as a number of other smaller assets across Italy.