Italiano




Residential

I. Description

Residential Investment & Asset Management identifies and promotes transactions involving the purchase of real estate investments for residential purposes and property development deals involving the building of new residential complexes or renovation of existing ones.

These activities consist of trading operations involving the acquisition of properties and their subsequent placement on the market through the sale of individual residential units.

Development activities involve managing the process that begins with the identification of attractive development opportunities, continues with their construction and ends with their sale.

II. Main events
  • On January 1st, 2006 Resident Berlin 1 P&K and Resident Berlin Zwei P&K bought 5 residential properties in Berlin for a total figure of 9.6 million euro.

  • On January 12th, 2006, after winning the bid closing on October 14th, 2005, the ownership of a residential real estate portfolio in Berlin, acquired for 72.5 million euro, was formally transferred to Tizian Wohnen 1 and Tizian Wohnen 2 - both investment vehicles of the subsidiary P&K Real Estate. The properties acquired formed part of the real estate portfolio of Corpus Immobiliengruppe.

  • After winning the bid on November 3rd, 2005, Centrale Immobiliare finalized its purchase of certain lots of land located in Golfo Aranci on January 17th, 2006 for a figure of 4.6 million euro.

  • On February 1st, 2006 Resident Berlin 1 P&K purchased 2 residential properties in Berlin at a price of 2.4 million euro.

  • On February 10th, 2006 Centrale Immobiliare purchased 51% of Geolidro from Risanamento Napoli for 9 million euro, making it now the sole shareholder in this company which owns a residential portfolio in Naples.

  • On March 30th, 2006 Resident Berlin 1 P&K entered into a commitment to purchase one residential property in Berlin for a figure of around 4.3 million euro.

  • On April 3rd, 2006, after obtaining clearance from the Polish anti-trust authorities, Pirelli RE completed the deal announced on February 15th, 2006 by purchasing 75% of Pekao Development for approximately 20 million euro from Bank Pekao (Unicredit Group). Pekao Development was then renamed Pirelli Pekao Real Estate. This company, which manages several residential developments in the city of Warsaw, is regarded as one of the principal real estate operators in Poland.

  • On May 31st, 2006 Resident Berlin 1 P&K entered into a commitment to purchase 16 predominantly residential properties in Berlin for the sum of 61.1 million euro.

  • On May 31st, 2006 Resident Berlin Zwei P&K entered into a commitment to purchase 2 residential properties in Berlin for the sum of 2.7 million euro.

  • On June 1st, 2006 Resident Berlin 1 P&K purchased 4 properties in Berlin for a total figure of 4.9 million euro.

  • On June 13th, 2006 Pirelli RE increased its interest in P&K Real Estate from 60% to 90%. This company had been set up in 2005 with Kronberg for the purpose of investing in the German residential market. Pirelli RE subsequently purchased the remaining 10% of P&K Real Estate on December 12th, 2006, making it this German company’s sole shareholder.

  • On August 2nd, 2006 in execution of the bid won on March 28th, 2006, Centrale Immobiliare purchased another site in Golfo Aranci for the sum of 2.9 million euro. Like the site purchased in January 2006, this one is also due to be developed for residential use.

  • On September 1st, 2006 Polish Investment RE Holding BV, a joint venture between Pirelli RE (40%) and Cypress Grove International (60%) was set up for the purposes of investing in the residential property sector in Poland. The joint venture’s goal is to carry out residential developments worth some 1.5 billion euro over the next three years. The joint venture’s first act was to purchase Nowe Ogrody, a company owning land and property complexes in Warsaw, from Pirelli Pekao Real Estate on September 26th. This completes the first stage in this investment project, involving the construction of around 3,300 apartments worth around 420 million euro once built.

  • On September 27th, 2006 Resident Berlin 1 entered into a preliminary agreement to buy 2 properties located in Berlin worth a total of 2.5 million euro.

  • On October 1st, 2006 and November 1st, 2006 Resident Berlin 1 finalized preliminary agreements made in the first half of 2006 to purchase 13 properties in Berlin worth a total of 53.3 million euro. Further to the preliminary agreements mentioned above, at December 31st, 2006 the company had 15.6 million euro in outstanding commitments to purchase properties in Berlin.

  • On October 9th, 2006 Pirelli RE signed a binding agreement to buy approximately 97% of Deutsche Grundvermögen (DGAG), one of Germany’s leading real estate companies with offices in Hamburg and Kiel. The relevant anti-trust authorities announced their authorization of the acquisition on December 19th, 2006 after which it was completed on January 10th, 2007, as described in more detail in the section on subsequent events.

  • On November 1st, 2006 Resident Berlin Zwei purchased 2 properties in Berlin for 2.7 million euro.

  • On December 5th, 2006 Nowe Ogrody 2 spent 4.6 million euro on purchasing a site located in Gdansk (Poland) due to be developed for residential purposes.

  • The Progetti Residenza fund was set up on December 22nd, 2006 as a speculative fund managed by Pirelli RE Opportunities SGR but not invested in by Pirelli RE. The fund’s real estate portfolio, consisting of a site in Milan Bicocca transferred from Iniziative Immobiliari 3, is due to be developed as a residential and commercial complex.

  • On December 28th, 2006 Resident Baltic, a subsidiary of P&K Real Estate, signed a preliminary agreement to purchase several properties located in Rostock in the north of Germany for the sum of 13.2 million euro.

  • On December 31st, 2006 Resident Sachsen P&K, a subsidiary of P&K Real Estate, purchased 14 properties located in several German cities for the total sum of 6.3 million euro. At December 31st, 2006 the company had 0.5 million euro in outstanding purchase commitments relating to just one property.

III. Results

The aggregate revenues of the Residential Asset Management came to 852.9 million euro in 2006 compared with 998.3 million euro in 2005, while pro-rata aggregate revenues for the year amounted to 388.6 million euro compared with 408.4 million euro in 2005.

EBIT including net income from investments was 40.4 million euro in 2006, having improved by 7% on the figure of 37.9 million euro reported in 2005.

Real estate sales amounted to 807.8 million euro in 2006 (938.1 million euro in 2005), generating 171.5 million euro in gross capital gains compared with 257.8 million euro in 2005.