UK-based private equity real estate group Benson Elliot confirmed on Thursday that it has made its first move in the Italian property market, as tipped by PropertyEU.
UK-based private equity real estate group Benson Elliot confirmed on Thursday that it has made its first move in the Italian property market, as tipped by PropertyEU.
Benson Elliot said it has acquired the Via Aurelia 278 luxury residential development in Rome and Terminal Nord retail park in Udine, Northern Italy.
'Benson Elliot’s investment reflects the firm’s confidence that Italy has turned the corner and is on the way to recovery, and its intention to be an early and significant mover in the country’s property markets,' the company said in a statement.
PropertyEU reported on Wednesday that the company had made its first foray into the Italian market with the purchase of Terminal Nord Retail Park in Udine from British Land's Pillar Retail Europark Fund (PREF) for a bargain price.
The 32,340 m2 retail park is believed to have been sold for just less than €50 mln, representing a discount of over 50% to PREF's acquisition price of over €100 mln in 2008. The deal reflects a gross yield in the region of 10%.
Terminal Nord - PREF’s only asset in Italy - had been put on the market by British Land in 2013 as part of the UK REIT's strategy to pull out of Continental Europe.
The scheme is 95% let to strong national and international occupiers including Carrefour, Casa, Decathlon, Euronics and Maison du Monde, Kiabi and OVS. CBRE is believed to be advising the vendor on the deal.
In the Italian capital, Benson Elliot has bought a development scheme comprising two buildings on a 10,000 m2 hill-top site in the attractive Aurelia area in the west of Rome. With all building permits in place, the property represents an attractive opportunity to deliver a luxury, €100 mln end-value project in Italy’s largest residential market. The Property was acquired from a private Roman family, who previously used the existing buildings, currently vacant, as a private hospital.
The development is expected to take two years to complete, with construction starting in Q3 2014.
Marc Mogull, managing partner of Benson Elliot, commented: 'The Eurozone crisis has receded, and we’ve seen Italian sovereign spreads fall 500 bps in just a couple of years. It’s inevitable that this shift in investor sentiment, combined with an improving economy, debt markets that are slowly healing and the expectation of political change will drive a recovery in property markets.'
