The deal sees COIMA and Redo acquire 100% of MilanoSesto SpA, the company that owns the vast majority of the site, from Hines Iron MilanoSesto Associates LLC. The two partners have also reached an agreement to acquire 27,000m2 of land, part of a site called Unione Zero, which is designated for social housing from Hines and Cale Street. Altogether this means COIMA and Redo have ownership of 90% of the regeneration development.
A former industrial site, MilanoSesto is in the north-east of Milan's metropolitan area, with a total area of more than 100ha. As part of the agreements, a series of complex financial operations have been concluded with Intesa Sanpaolo, the project’s main financier, and other lenders, including Unicredit, Banco BPM and IFIS, involving the conversion of around €900m of debt into equity. This ensures the recapitalisation of the project, contributing to the recovery and further revitalisation of an area that is strategically important to the Milanese metropolitan area, Lombardy and Italy.
The MilanoSesto site is spread across two distinct areas, the largest of which covers c. 840,000m2 and is owned by MilanoSesto SpA. The area will now be brought forward by COIMA and Redo, mainly comprise residential development, including subsidised and social housing, as well as the City of Health and Research, a centre of clinical and scientific excellence which belongs to the Lombardy Region, and a park of c. 45ha.
The 155,000m2 Unione Zero area includes 27,000m2 for a social housing project – which has been acquired by COIMA and Redo from Hines and Cale Street. This will consist of approximately 350 new apartments for employees of the City of Health and Research and its related facilities. The residences will be developed through a newly established fund, managed by Redo and subscribed by Re-City, Redo’s City Regeneration Fund, and the COIMA Housing Fund. The latter was established by COIMA to invest in sustainable housing and is backed by Intesa Sanpaolo and a range of leading Italian institutional investors.
The remaining part of the Unione Zero site, approximately 128,000m2, will continue to be owned by the Unione Zero fund, managed by Prelios SGR, with investment from Cale Street and Hines. This area will retain its current uses under the existing plans, which includes offices, student housing, hotel and open-market housing.
Manfredi Catella, Founder and Chief Executive Officer of COIMA SGR, said: “MilanoSesto is one of the most important urban regeneration projects in Europe. COIMA's commitment alongside Redo, a leading company focusing on regeneration with a high social impact, and the consolidated partnership with Intesa Sanpaolo, a leading European banking group at the forefront of sustainable infrastructure projects, provides a unique blend of skills to support Milan and Italy's growth. With a deep sense of responsibility, together with our partners, we will take forward this strategically important project with the aim of ensuring it becomes an international benchmark for socially and environmentally sustainable urban redevelopment, attracting national and international investors with strong ESG commitments, creating a thriving place fit for a zero-carbon future.”
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