Retail real estate operator IGD has sold a portfolio of retail assets in Italy valued at €258 million.
The buyer is a consortium of investment firms Sixth Street and Starwood Capital and asset manager Prelios SGR.
The real estate portfolio will be operated a closed-end investment fund (Food Fund) managed by Prelios SGR. 60% of the fund will be held by a Luxembourg vehicle (50% Sixth Street and 50% Starwood Capital), while IGD will hold the remaining 40%.
Net of the amount invested in the fund, IGD will receive approximately €155 million in cash, which will be used to repay existing debt.
The portfolio consists of 13 assets, including eight hypermarkets (located in Chioggia, Porto d’Ascoli, Roma, Rimini, Conegliano, Ascoli Piceno, and two in Bologna), three supermarkets (located in Civita Castellana, Ravenna, and Rome) and two shopping malls (located in Bologna and Chioggia). The assets generate a net rental income of €17 million per year.
The transaction is expected to close by April 2024.
Asset Disposal Plans
The sale of 13 assets aligns with IGD's 2022-2024 plan to reduce its financial leverage.
IGD will use the proceeds from the sale to partially repay existing loans on the sold properties, early repay portions of other loans, and generate €11 million in annual savings on financial charges.
This deal includes an agreement with SGR to manage the sold properties. By optimising them, IGD expects to generate an additional €2 million per year in revenue from project, property and facility management and to sell the properties later at a premium, further improving its financial position.
IGD’s CEO Claudio Albertini said, “This disposal represents a significant milestone because, along with the one completed at the end of 2021, it brings the total resources raised over the last three years to reduce the Group’s indebtedness to approximately €270 million.”
