EXCLUSIVE: Over €1b of Italian assets up for grabs

Over €1 bn of commercial real estate is about to change hands in Italy, marking a remarkable resurgence of investment activity in the country’s beleaguered property market.

According to well-informed market sources, the largest portfolio for sale is a package of 15 retail assets owned by Auchan Group's Gallerie Commerciali Italia.

Morgan Stanley Real Estate Investing is understood to be acquiring a majority stake in the portfolio which is valued at some €700 mln.

The sale is aimed at allowing GCI and Auchan to finance a large development programme planned in Italy. GCI owns a total of 46 retail centres in Italy, largely anchored by Auchan hypermarkets.

The deal would give a major boost to the investment market which reported as little as €520 mln of deals in the first three months of the year, around half of the average volume reported in the country in the past eight years.

In the retail sector, Europa Capital is believed to be in exclusive negotiations to acquire the 8Gallery shopping centre in Turin's Lingotto district, in Northern Italy from CBRE Investors. The price is understood to be around €80 mln, according to well-informed market sources.

CBREGI inherited the 21,500 m2 asset during the acquisition of ING Real Estate which bought it in 2006 for around €92 mln, or a gross yield of 5.5%.

The mall includes 90 shops, 14 restaurants and an 11-screen multiplex cinema as well as 4,000 parking spaces.

Similarly, US-based investor Blackstone is in exclusive negotiations to acquire the Franciacorta Outlet Village in Rodengo Saiano near Brescia in Northern Italy. The asset is owned by Aberdeen Asset Management which inherited it from Degi at the time of the acquisition of the German unit in late 2007.

To the south of the country, financial services group GWM is understood to be buying the Market Central Da Vinci retail park near Rome, according to well-informed market sources. GWM is in exclusive negotiations to acquire the 58,000 m2 asset from developer AIG Lincoln for over €120 mln.

Other assets for sale include the Meraville retail park in Bologna, owned by Pradera, Fashion District’s factory outlet in Mantova and British Land’s Retail Park Terminal Nord in Udine. In Milan, local developer Euromilano has put its Cascina Merlata shopping centre project for sale.

Portuguese retail specialist is also selling in Italy. The company is seeking a buyer for the Valecenter shopping centre in the Veneto region and the Airone shopping centre, worth over €100 mln.

In the office segment, the market this year was dominated by the purchase on the part of Qatari investors of a 40% stake in the Porta Nuova mixed use project in Milan, valued at some €2 bn.

Developer Hines, which managed the sale of Porta Nuova, is also believed to be selling an office at Piazza Sturzo in Rome for an undisclosed amount. Similarly, Italian publisher RCS has puts its head office at Via Solferino in Milan on the market with a price tag of €80 mln.

Office deals already concluded include AXA REIM's purchase of office buildings in the Bodio business park in Milan and Allianz's acquisition of two offices in Milan and Rome from Morgan Stanley Real Estate Investing.