Pirelli Real Estate is launching the first private fund focused on Italy's Sicily region. The closed-end Fondo Immobiliare Pubblico Regione Siciliana (FIPRS) will be managed by the Italian real estate giant. The portfolio consists of 34 properties, valued at EUR 263 mln, which the Sicilian region and some regional institutions provided. The term set for the fund is fifteen years.

Pirelli Real Estate is launching the first private fund focused on Italy's Sicily region. The closed-end Fondo Immobiliare Pubblico Regione Siciliana (FIPRS) will be managed by the Italian real estate giant. The portfolio consists of 34 properties, valued at EUR 263 mln, which the Sicilian region and some regional institutions provided. The term set for the fund is fifteen years.

FIPRS is one of Italy's first contribution funds created at the request of a territorial public institution. Pirelli RE, which won the tender to manage part of Sicily's property portfolio last December, announced it is planning to strengthen its position as a partner for public institutions wanting to enhance their property portfolios. The value of the business in Italy is estimated at over EUR 400 bn.

The properties are mainly offices located on the island's main cities of Catania, Agrigento, Caltanissetta, Ragusa, Siracusa, Trapani and Palermo. The portfolio offers a total space of 193,000 m2 that is leased to the local authorities. The total annual passing rent equals approximately EUR 20.9 mln, corresponding to a yield of 7.95%, Pirelli RE said in a press release.

The Region of Sicily holds a 35% stake in the fund, Deutsche Asset Management's RREEF Global Opportunities Fund II holds 33%, and Pirelli RE has 22%. The remaining 10% has been underwritten by REEF which will place it with international institutional investors. Intesa Sanpaolo Group's Banca Caboto and Capitalia are the placement managers, with Intesa Sanpaolo and Capitalia Group's MCC acting as the financing banks.