Coima RES has purchased an office complex in Via Monte Rosa 93, Milan for €57m. The purchase price represents a discount of 3.7% vs the fair value of €59.2m, as estimated by the independent appraiser CBRE. The fair value implies an EPRA net initial yield of 5.0% and an EPRA topped-up net initial yield of 5.2% (excluding the vacant portion of the property). Gross passing rent is €3.5m per year and gross stabilised rent is €3.6m per year (excluding the vacant portion of the property). The seller of the property is TEUR S.p.A., the Italian sub-holding of the Techint Group.
Monte Rosa represents a sizeable core plus asset rented at attractive levels (considering the recent rental growth in Milan), situated in an established semi-central Milan business district. Proximity to the newly developed CityLife district and good transport connections to two metro lines (MM1 and MM5) add to the asset’s appeal. The acquisition contemplates a short-to-medium-term value enhancement strategy including lease-up of vacant premises and reletting of space vacating over the coming years and a potential recovery of surfaces previously authorized which could increase the surfaces by up to c. 30%.
Monte Rosa is composed of four buildings which were subject to intensive refurbishment works in 1997. The complex is characterised by efficient space utilisation with a total gross buildable area of 23,728 m² and net rentable area of c. 14,500 m² (excluding parking areas).
The Monte Rosa acquisition was sourced “off-market” and is structured as a sale and leaseback of the Italian headquarters of the Techint Group on a nine-year basis with an unbreakable master lease 100% indexed to CPI. Techint - a global industrial conglomerate with revenues exceeding €12.7bn ($15bn) and 48,500 employees worldwide - will, therefore, become one of the main tenants in the complex, accounting for 40% of the NRA. The other tenants are PwC and an Italian tourism company, occupying 43% and 6% of NRA, respectively. The overall WALT is 5.2 years.
The purchase is financed by Coima RES using its own cash on balance sheet.
