PGIM Real Estate has entered into a new joint venture with Cittamoderna to invest and deliver residential properties in major cities across Italy. PGIM Real Estate is the $210 billion real estate investment and financing business of PGIM.
The venture will target residential, or to be developed into residential, sites with the aim to develop, refurbish, manage and sell the properties via fractionated sale. The venture will focus on investments in Italy’s major cities including Milan. PGIM Real Estate has entered the venture on behalf of its European value-add strategy.
Cittamoderna is a real estate investment firm active since 1950 in residential development and prime assets redevelopment with over 320,000sqm developed to date. In 2019, Antonio Prezioso and Piera Prezioso launched Cittamoderna Asset Management Platform aimed at managing institutional investors owned assets.
The venture’s first investment is a redevelopment of an existing office site in Milan totaling 7,000 sqm, into roughly 100 unit for sale residential apartments. The apartments will be developed with strong environmental considerations including optimization of solar light and improving energy through high performance insulation. The building is in a strong location well suited to residential development with nearby amenities such as supermarkets, banks and gyms, and strong transport links with close proximity to Milan city centre.
The residential sector in Italy has continued to see strong investor interest in prime locations in major cities, such as Milan, given long standing undersupply and the strong demand for high quality and energy efficient assets.
Musie Bocrezian, Head of Transactions for Italy at PGIM Real Estate comments, “Italy’s residential market is hugely undersupplied – we are seeing strong demand for high quality, efficient and sustainable buildings in major cities, and this is exactly what our venture aims to deliver. Our first investment will supply around 100 modern apartments in a prime location in Milan, attracting new residents to the area. We are delighted to partner with Cittamoderna and look forward to developing our pipeline.”
Antonio Prezioso, CEO at Cittamoderna AM said, “The main strength of the JV between PGIM Real Estate and Cittamoderna is the perfect combination between PGIM’s strong financial capacity and Cittamoderna’s established expertise in Italian residential industry”
Led by Bocrezian, PGIM Real Estate has a dedicated on-the-ground transaction team in Italy since 2020. Based in the group’s Milan office, the team has made investments across sectors such as hospitality, logistics and residential.
For the venture’s first investment, PGIM Real Estate and Cittamoderna were advised by Shearman and Sterling (Legal), Todarello & Partners (Legal), DILS (Agent) and Avalon. The transaction was financed by Banco BPM.