Hines, the international real estate firm, in a joint-venture with a group of German pension funds, has completed the purchase of a trophy building on Via Orefici adjacent to Piazza Cordusio, Milan’s prime office and high street retail destination for €100m.
The 12.000 m² building is located in the very heart of the historical centre of Milan, ca. 500 metres from Piazza Duomo. The building was formerly the historical global headquarters of eyewear retailer Luxottica and will be converted into a mixed-use property with retail components on the lower floors and prime office space on the higher floors.
The flagship building is fully vacant and will undergo an extensive renovation, benefiting from the new upcoming location of Piazza Cordusio which is attracting the interest of major international retail and office tenants. Once refurbished, it is envisaged that the building will be held as a long term investment.
This transaction is the eighth investment by Hines in Italy over the past 15 months, following the investments in historical buildings on Milan’s Via Dante, Piazza Cordusio, Via Broletto, Via Torino, Piazza Edison and Via Tornabuoni in Florence.
Mario Abbadessa, Italy country head for Hines, said: “The historical centre of Milan and particularly the area surrounding Piazza Cordusio represents a prime location that has proved to be resilient to volatile market corrections. The asset itself is of particularly high quality, making this an attractive investment.”
“The resurgence in demand of the historical centre of Milan for both high-street retail and office tenants makes the restoration of these historical buildings and their long-term hold an attractive investment proposition for our investor clients. Via Orefici is a great example of this strategy,” said Peter Epping, fund manager at Hines for the separate account investing in this asset.
Lars Huber, CEO of Hines Europe, added: “Italy remains an attractive market with significant potential and we are delighted to add this latest trophy asset to our portfolio. Once redeveloped the asset will offer strong income potential through its office and retail elements and represents a strategic long-term hold for the company.”
Hines Italy entered in the market in 1999 and since then has been developed projects on excess of €3bn including the major urban development project of Porta Nuova. During the last 15 months Hines Italy has acquired on behalf of institutional investors 8 buildings for a value of about €800m composed of prime office and high street including trophy assets like Piazza Cordusio, Via Broletto and Piazza Edison in Milan along with via Tornanuoni in Florence.
The legal support was provided by DLA Piper with PWC for tax, J&A for technical and GVA Redilco for commercial aspects.
