Hines, the international real estate firm, has entered a joint venture with PGGM, the Dutch pension fund service provider, to launch a separate account program primarily targeting high-street retail, office and mixed-use value-add developments in the northern Italian city of Milan.
Hines will co-invest alongside PGGM into the account, which has an initial commitment of €155 mln of equity, supported by moderate debt finance, and is expected to grow as further capital is deployed.
Targeting prime assets in the heart of the historic city of Milan, the account is committed to pursuing a sustainability agenda through refurbishment of assets to meet the highest international standards of building energy efficiency, to upgrade the quality and enhance their value, in keeping with Hines’ philosophy to real estate development.
PGGM and Hines have already completed the first acquisition for the account, purchasing a portfolio of three buildings from Banco BPM for €110 mln. Alongside the 10-story Piazza Liberty tower in the center of Milan, the portfolio includes two buildings in the historic center on Via del Lauro and Via Mazzini. The three assets provide a mix of retail and office amenities.
With a total surface area of 20,000 m2, the three buildings will undergo an extensive €30 mln refurbishment and renovation program to transform the buildings into high quality, contemporary high-street retail and office spaces to meet current demands.
Lars Huber, CEO for Hines Europe, said: 'Hines and PGGM have a long relationship, developing real estate together since the 1980s. PGGM is a trusted, highly respected partner and we are pleased to be extending our relationship through this account. We are pleased to have launched this account in parallel with the first joint acquisition, and look forward to growing it further.'
