Italian insurer readies sale of €1bn real estate portfolio

There was some excited talk at the recent MIPIM in Cannes about Italian insurer Generali's plans to boost its coffers by selling off a major property portfolio. The portfolio, known as Stardust, is valued at more than €1bn.

A report in Italian business daily "Il Sole 24 Ore" said that the Trieste-headquartered Generali had engaged Morgan Stanley to advise on the sale of the portfolio, which is to be finalised before the end of the year. Generali is known to be engaged in cost-cutting and disposal of non-core subsidiary holdings to boost its Tier I equity capital to comply with Solvency II regulations.

The portfolio, thought to consist of 69 separate asset with 300,000 of lettable space across Germany, France, Italy and Austria, is said to generate €50m in rental income annually.

Among the four parties who've submitted ono-binding bids are Germany's Patrizia Immobilien, CBRE Global Investors and a consortium led by Swiss bank UBS.

The move comes as Generali, Italy's largest insurer, plans the opening of a London office to grow non-property third-party assets under management in the UK and the Nordic countries for its pension fund clients. Third-party assets under management are currently €17bn out of a total of overall group AUM of €431bn.

Last year the insurer gained the necessary approval from the Bank of Italy for its growth thrust into the new markets and new institutional asset classes, reducing its dependence on Italy, Germany and France.