Investors Sixth Street and Starwood Capital have agreed to buy a majority stake in a 13-unit Italian retail portfolio from Immobiliare Grande Distribuzione (IGD) for €258 million.
The portfolio consists of eight hypermarkets in Chioggia, Porto d’Ascoli, Rome, Rimini, Conegliano, Ascoli Piceno and 2 in Bologna, three supermarkets in Civita Castellana, Ravenna and also Rome and shopping malls in Bologna and Chioggia. Together, they generate approximately €17 million in net annual rental revenues.
Details of the sale of the Italian retail portfolio
The closing of the transaction will take place by April 2024. It will be carried out through the establishment of a closed Real Estate Investment Fund called the “Food Fund”, established and managed by Prelios SGR, one of the main real estate asset management and services companies in Italy.
In total, 60% of the fund (class A shares with preferred return) will be held by a Luxembourg vehicle (50% Sixth Street and 50% Starwood Capital), while the remaining 40% (class B shares with subordinated return) will be held by IGD.
Net of the portion reinvested in the fund, IGD will collect approximately €155 million from the sale for the sale of the shares at the time of closing.
IGD will sign a contract with Prelios SGR to continue managing project, property and facility management activities on the portfolio, with the aim of further enhancing it and selling it on the market at the best price.
Important business milestone
Claudio Albertini, CEO of IGD, says, “With this operation we are completing the implementation of the asset disposal strategy defined in the 2022-2024 Business Plan. This sale represents an important milestone because, together with the one completed at the end of 2021, it brings the total resources raised in the last 3 years to reduce the Group’s debt to around 270 million euros. In this way we will reduce the Loan to Value by approximately 3.7 percentage points.”
Immobiliare Grande Distribuzione develops and manages shopping centers throughout the country and has a significant presence in Romanian retail distribution. IGD has a real estate portfolio valued at circa €2,005.1 million at 30 June 2023.
About the companies
Prelios SGR has assets under management of approx.€ 8 billion. It is active in the promotion, creation and management of real estate alternative investment funds (AIFs) and credit funds, advisory and also separate account management, for leading Italian and international institutional investors.
Sixth Street is a global investment firm with approximately $75 billion in assets under management and committed capital. The firm has more than 500 team members including more than 200 investment professionals operating around the world.
Starwood Capital Group is a private investment firm with a core focus on global real estate. The Firm and its affiliates maintain 16 offices in seven countries around the world, and currently have 5,000+ employees. Since its inception in 1991, Starwood Capital Group has raised over $75 billion of capital, and currently has ~$115 billion of assets under management.
