Pirelli & C. Real Estate and Bovis Lend Lease: accord of major projects

Pirelli & C. Real Estate, leaderin the Italian property market for asset management and specialistservices, and the Anglo-Australian group Bovis Lend Lease, theworld leader in Project & Construction Management, announcethe signing of a strategic agreement for the financing and constructionof major projects. Activities will cover the whole project lifecycle, from inception to handover and particular focus willbe directed towards proposing projects where project financingis the key development vehicle.

The two companies will examine opportunities, in the publicand private sectors, where the synergy deriving from Pirelli'sestablished property and management expertise can complementBovis Lend Lease's world wide proven project delivery skills.

The agreement has an initial duration of five years and providesfor the possibility of application across all of the new initiativesin which both companies will become involved.

According to Carlo Alessandro Puri Negri, Pirelli & C. RealEstate's Vice President and Managing Director, "this strategicagreement will allow both companies to unify their experienceand financial strength, to offer development solutions to themarket for major projects (highways, airports and railways)and also to the construction sector (residential, offices, schoolsand hospitals)".

The coming together of the two companies will bring benefitsboth to the public administration, which will be able to envisagecomplex developments with a social need capable of attractingprivate capital, and to private corporations.

John Spanswick, Chief Executive of Bovis Lend Lease Europe commented"We are actively looking at a number of interesting projectsthat would benefit from the joint approach that we can offertogether with Pirelli and I expect us to be able to announceour first joint project in the coming months".

Pirelli& C. Real Estate is the Pirelli Group's company that providesasset management and specialist services to the property market(residential, offices, project management, property & facilitymanagement) with a turnover of Euro 244milion and 500 employees.The portfolio managed by the Group is in the region of Euro8billion, of which Euro 4billion is from external sources andEuro 4billion from companies controlled by the principal USproperty funds and Italian investors, to which Pirelli & C.Real Estate participates with a minority shareholding. In theproject management sector it has a specialist company with 56employees and a predicted turnover for 2001 of Euro 170milion.One of its largest developments is the conversion of the vastindustrial area at Bicocca, to the north-east of Milan. This1,000,000m2 site has been undergoing a gradual and planned conversionfrom industrial use to a mixed development since the beginningof the 90's. The new urban arrangement includes for offices,university faculties, public and private research centres residentialand commercial buildings totalling approximately 800,000m2 ofgross floor area developed, with 75% of the site completed.Clients include Deutsche Bank, Siemens, Philips, Rusconi Editori,Reuters, Compaq, Pirelli SpA, Warner Village; investor clientsinclude public assurance entities and the property funds ofSal Oppenheim, Unicredito and Siemens AG, besides private investorsfor residential construction.

BovisLend Lease who operates globally with an annual turnoverof USD2.5billion and 7.500 employees, has been active in Italysince 2000, with offices in Milan. They have recently brokenground in Italy in the public health sector, with the announcementthat they are co-promoters for the Lit.70billion (USD32milion)renovation of Brescia hospital, where project financing hasbeen successfully applied as the development vehicle. Theirproject portfolio includes blue chip clients such as Cisco Systems,AMAT, BEA and BPB Gypsum. Bovis Lend Lease is also part of oneof the largest managers in real estate investment and fundsmanagement in the world: the Australian Group Lend Lease managesmore than A$77 billion (USD40billion) for institutional, mutualfund and private clients. That money is invested in propertyfunds, real estate securities, mortgages and commercial mortgage-backedsecurities.