The Carlyle Group to Acquire Portfolio of 10 Buildings for €91 million

Milan - Global private equity firm The Carlyle Group today announces the acquisition of a portfolio consisting of 10 real estate assets for €91 million from Reale Mutua Assicurazioni Group, a leading Italian insurance company.

The buildings in the portfolio are mainly located in the major towns in central-northern Italy, including Milan, Bologna, Turin and Ferrara, and the assets are a mix of office, residential and one industrial site. The acquisition will be made through Carlyle Europe Real Estate Partners II, a €760 million fund.

Carlyle Europe Real Estate Partners plans to split up the portfolio and sell the residential assets unit by unit. It also plans to refurbish and renovate the office buildings in Milan before the sale.

Guido Audagna, Managing Director of The Carlyle Group in Italy, said: "This acquisition demonstrates Carlyle Europe Real Estate Partners’ strong focus on the Italian market, and in particular in secondary locations and assets that require renovation and repositioning. The portfolio has a trading component with regard to the residential assets but above all Carlyle Europe Real Estate Partners plans to add value to the office buildings, in line with the investments completed to date."

This is Carlyle Europe Real Estate Partners fourth portfolio acquisition in Italy. In March 2003 Carlyle Europe Real Estate Partners acquired the Jupiter portfolio of 36 properties for €230 million from Italy’s Ministero dell’Economia e delle Finanze. In November 2004, Carlyle acquired a portfolio of 230 properties for €320 million from San Paolo IMI, in partnership with Immofinanz, and in July 2005, Carlyle Europe Real Estate Partners acquired a 26 building portfolio from Beni Stabili in partnership with Operae S.p.A for €255 million.

Carlyle Europe Real Estate Partners was advised by Clifford Chance as legal advisor and DLA&Partners as fiscal advisor. GC International acted as the broker. Assets evaluation and technical and environmental due diligence were completed by REAG. The acquisition is financed by a group of banks coordinated by Lehman Brothers.