Samsung snaps up Milan's Porta Nuova office scheme

South Korean electronics giant Samsung has inked the acquisition of an office scheme at Milan’s Porta Nuova development project from funds managed by Hines Italia, a joint venture of US developer-investor Hines and the Italian Catella family, as tipped by PropertyEU in early July.

Samsung Life Insurance and Samsung Electronics have bought one of the so-called 'Diamantini', a Kohn Pederson Fox Associates-designed office scheme offering 12,500 m2 located adjacent to the main tower in the 40,500 m2 Varesine section of Porta Nuova, a 254,000 m2 mixed-use development in downtown Milan.

The South Korean investor, which was advised on the deal by IPI and DLA Piper, plans to relocate to the new building which will become its Italian headquarters from 2015. The asset recently received a LEED Gold environmental rating.

The deal is the first acquisition in mainland Europe by Samsung after having made its first foray into the UK last year with the acquisition of the London headquarters of law firm Pinsent Masons at 30 Crown Place, London EC2. The purchase price of £145 mln (€170 mln) reflected a net yield of 4.7%.

'We are extremely happy to move to the city centre and to locate our Italian business operations in the real business heart of Milan,' commented Carlo Barlocco, deputy president of Samsung Electronics Italia. 'By moving our offices in Porta Nuova we want to be closer to Italy and to the Italian consumers, business and institutions. And, as official global partner of Expo Milano 2015, we want to witness our support for the most important event taking place in Milan next year.'

'The agreement with Samsung for its Italian headquarters helps consolidate Porta Nuova as one of the most important areas and economic regeneration projects in Europe and confirms the esteem which Italy and Milan enjoy worldwide,' added Manfredi Catella, CEO of Hines Italia Sgr.

Hines Italia Sgr was advised by Citi. Gianni Origoni Grippo Cappelli & Partners and Studio Maisto provided legal and tax advice, while Coima advised on technical matters.

Samsung joins a number of other high-profile occupiers including Unicredit and Google which have relocated to Porta Nuova, bringing the occupancy of the office section to 80%. In total, Porta Nuova provides 254,000 m2 of residential, office and retail space across three sections, Varesine, Isola and Garibaldi, located near Milan's central station.

The Garibaldi section is home to the 30-storey Garibaldi Tower, officially the tallest building in Italy, designed by Cesar Pelli. The skyscraper provides over 60,000 m2 and is 100% leased to Unicredit Bank.

Qatar Holding, a unit of Qatar’s sovereign wealth fund, has the relative majority in the project after having acquired a 40% stake last year in a deal valuing the entire site at €2 bn. The development recently secured a €450 mln, five-year loan from a bank consortium comprising BNP Paribas as agent, as well as UniCredit, Banca IMI, Société Générale and Bank of America Merrill Lynch and BNP Paribas as joint mandated lead arrangers.

Following the deal, the debt of the Porta Nuova Garibaldi fund has been reduced to 55% in line with its core investment profile.

Samsung is also understood to be under offer to buy the Silver Tower in Frankfurt from IVG Institutional Funds. The 32-storey office tower is being acquired for around €450 mln, according to well-informed market sources.

IVG bought the asset for €400 mln on behalf of a consortium of investors in 2011 from Commerzbank. IVG itself took a 10% share in the tower, which provides a total of 72,000 m2 on 36 storeys and is let in its entirety to railway company Deutsche Bahn. Originally built in 1978, the 166-metre Silver Tower underwent a €100 mln renovation programme in 2009 and 2010.