EXCLUSIVE: Blackstone poised to buy Italian public office portfolio

US private equity group Blackstone is on the verge of closing the acquisition of five Italian office buildings in a government-let portfolio deal worth about €160 mln, PropertyEU has learned.

The portfolio is believed to comprise two buildings in Milan and one each in Genoa, Turin and Como.

The buildings that Blackstone is poised to buy are among the 21 properties offered for sale by Fondi Immobili Pubblici (FIP), a state-owned fund managed by Investire Immobiliare Sgr.

Investire Immobiliare, part of Banca Finnat Euramerica, hired CBRE in May this year to market the assets, which consist of office buildings let entirely to the public administration. According to well-informed market sources, the total portfolio has a value of around €800 mln and covers a total of 800,000 m2 of space.

FIP is also understood to be in negotiations with US private equity group Cerberus to sell another sub-portfolio consisting of three army barracks in Bari, Rome and Bergamo as well as a number of other smaller assets across Italy. The US investor has been granted exclusivity on this package which is expected to fetch around €250 mln.

Launched in 2004, FIP was the first real estate fund to be created by the Italian government as part of a major privatisation effort and owns around 400 buildings across the country. The assets for sale are largely located in Northern Italy, in the regions of Lombardy, Piedmont, Liguria and Friuli-Venezia Giulia, as well as in the Lazio and Tuscany regions with some located in the South - Abruzzo and Apulia.

They are home to public administration offices including public pension funds INAIL, INPS, the ministry of transport, the Internal Revenue Service, the Customs Agency, the police, the ministry of labour and the Territorial Agency.

All the properties are leased with a master lease agreement to the Agenzia del Demonio, the country's public real estate agency, with a contract running to December 2022. In total, the portfolio generates gross annual rents of over €63 mln.