Geneva, the 10th January 2022
AB Alternative SICAV-SIF, European Real Estate Sub-Fund continues to expand its portfolio and has just completed its fourteenth acquisition, with the purchase of an office building in Milan, Italy. The asset is ideally located in the immediate vicinity of Milan in Milanofiori, the leading business district in Milan’s hinterland area and strategically positioned close to the metro station (20 minutes direct line to the city centre). This business district hosts the head offices of high standing national and international companies.
Milan is the country’s industrial and financial heart. With a 2019 GDP estimated at €174.9 billion, the province of Milan generates approximately 10% of the national GDP, while the economy of the Lombardy region generates approximately 22% of Italy’s GDP (roughly the size of Belgium). The province of Milan is home to about 45% of businesses in the Lombardy region and more than 8% of all businesses in Italy.
The location offers a defensive rental level and location for companies that seeks competitive rents and good accessibility by car and public transportation. The district offers also an extensive range of amenities including conference and meeting centre, a hotel, a shopping centre and is also surrounded by an extensive green environment, a key component nowadays for a well-balanced work life. The asset is fully let to four different tenants including two international companies (IGP Decaux, a subsidiary of the French group JCDecaux specialised in outdoor advertising, and Captrain, the European freight railway network), which have consolidated their presence in this location and have recently renewed their leases.
This acquisition complements our existing Italian portfolio and is in line with the fund’s strategy to invest in secondary office locations in European dynamic cities. The asset has a solid cash flow stream, an excellent upside potential, and will definitely enhance the overall portfolio performance.
The deal was originated and advised by Savills Investment Management in Italy. On the legal side, Gatti Pavesi Bianchi Ludovici (“GPBL”) advised the fund for this transaction. Savills Investment Management will be responsible for the asset management of this property, as for the other assets in the Italian portfolio.