ENEL
Office Portfolio in Italy
The DSF Group with an Italian partner acquired, repositioned and redeveloped 38 office buildings throughout Italy.
Investment Opportunity
The largest publicly traded utility in Europe, the national electricity company in Italy, ENEL, decided to sell a 51% controlling interest in a $700 million portfolio of office buildings that they owned primarily in Italy’s economic and cultural centers - Rome, Milan, Florence and Naples. In order to acquire this controlling interest DSF created a partnership with an Italian affiliate of American Continental Properties and an international investor group including the Government of Singapore Investment Corp, (GIC), General Electric Investment Management (G.E.), the Dutch pension fund, ABP and Belgium’s KBC bank.
Value Added Strategy
Through an extensive private negotiation we were able to select 38 office buildings from ENEL’s portfolio. We created excellent downside protection because ENEL agreed to occupy 75% of the properties 4.0 million square feet. For the balance of the portfolio we added value by actively leasing the space, replacing lower rent first floor office tenants with upscale retail stores, renovating some properties and converting others to more profitable uses. Over the succeeding six years we were able to sell all the properties at significantly appreciated values.