PIRELLI RE SGR: DEBUT OF TWO NEW REAL ESTATE FUNDS WITH MARKET VALUE IN EXCESS OF €400 MILLION

Apr 30 2010
ANASTASIA, A SPECIALISED OFFICE SECTOR FUND FOR INSTITUTIONAL INVESTORS:


- ITS PORTFOLIO COMPRISES 5 PRIME PROPERTIES WITH MARKET VALUE OF €318 MILLION

- FUND VALUE, NET OF DEBT, IS €140.5 MILLION




- BANCA IMI, MEDIOBANCA, MORGAN STANLEY AND UNICREDIT HAVE PLACED THE OFFER WITH ITALIAN AND FOREIGN INSTITUTIONAL INVESTORS



MONTEVERDI, A FUND SPECIALIZING IN THE OFFICE, INDUSTRIAL AND RETAIL SECTORS FOR INSTITUTIONAL INVESTORS:

- ITS PORTFOLIO COMPRISES 8 PROPERTIES AND 2.26% OF THE UNITS IN ARMILLA, A FUND MANAGED BY PIRELLI RE SGR, FOR TOTAL MARKET VALUE OF €88.8 MILLION FUND VALUE, NET OF DEBT, IS €62 MILLION

- THE FUND HAS BEEN SUBSCRIBED BY ITALIAN AND FOREIGN INSTITUTIONAL INVESTORS



WITH THESE NEWFUNDS, PIRELLI RE SGR CONSOLIDATES ITS LEADERSHIP IN ITALYWITH TOTAL ASSETS OF €6.3 BILLION



Milan, July 30th, 2010 – Pirelli RE SGR has launched two new real estate funds, Anastasia and Monteverdi, with a total market value in excess of €400 million. Taking its total assets of some €6.3 billion, these new launches have consolidated Pirelli RE SGR's leadership in Italy's real estate fund market and its strategic centrality to the Pirelli RE business model.

Anastasia Fund

Anastasia is a contribution fund for institutional investors, set up and managed by Pirelli RE SGR and specializing in properties primarily used as "Offices".

Anastasia’s portfolio comprises 5 prime properties, one of which will be transferred on completion of construction due by the end of 2010. The overall market value (OMV) of the properties is some €318 million, as per the appraisal by the independent experts Patrigest.

Recently built or refurbished, the properties are mostly located in the cities of Milan and Rome and meet the highest standards of quality and energy and environmental efficiency. The occupancy rate of the buildings, home to the head offices of major groups, is 93%.

Anastasia is a "core" product, created to satisfy investors' specific risk/return profile and time horizon. The property tenants are diversified in profile and all have high credit ratings. The fund offers a stable income flow, thanks to the preponderance of long-term leases, and an attractive target IRR of around 9%, consistent with the fund's "core" nature. The term of the fund is 10 years (with the option of extending it by another 2 years, plus a potential 3-year grace period if needed to complete the portfolio’s liquidation).

The Fund's conferral value is €280.7 million and incorporates a discount of around 11.7% on market value and of some 21% on NAV. The value of the Fund, net of debt (all of which secured against the properties) is €140.5 million.

The fund's units have all been placed with top Italian and European institutional investors. The financial advisors, arrangers and placers of the offer were Banca IMI, Mediobanca, Morgan Stanley and Unicredit; Intesa Sanpaolo while Unicredit acted as the fund's financing banks; Patrigest as independent experts; Bonelli Erede Pappalardo as legal advisors; and Vitali Romagnoli Piccardi e Associati as tax advisors.


Monteverdi Fund

Monteverdi is a fund specializing in properties primarily for "Office, Industrial and Retail" use; its portfolio comprises 8 properties mainly located in the provinces of Turin and Perugia, as well as 2.26% of the units in the Armilla Fund, managed by Pirelli RE SGR. The Fund's overall market value is €88.8 million, as per the appraisal by the independent experts Patrigest. Net of debt, the value of the Fund is €62 million.

Monteverdi is a "speculative" product, most of whose properties are "value added", ie. their potential value is expressed as a result of specific intervention, except for the recently constructed and fully let multi-screen complex in Perugia.

The termof the Fund is 7 years (plus potential rolling 3-year extensions up to a maximum of 30 years). The units have all been subscribed by top Italian and foreign institutional investors. Pirelli RE will retain about 42% of the Fund’s units (inclusive of those held through Pirelli RE SGR).