Italian fund manager Prelios Sgr has announced the sale of the historic Rinascente building located in Milan's Piazza Duomo for EUR 472 mln, representing a gross yield of 4.7%. The landmark department store was sold to the Ippocrate investment fund, which is majority-owned by the privatised pension fund for Italian doctors and dentists (Enpam) and is managed by Italian fund manager First Atlantic Real Estate.

The sale of the asset, with a total surface of 53,000 m2, will generate EUR 108.5 mln in gross capital gains for Prelios.

First Atlantic is believed to have emerged ahead of other bidders including Sorgente in the competition to acquire the flagship property controlled by the Retail & Entertainment fund, which is managed by Prelios (formerly Pirelli Real Estate) and is owned by Prelios together with Investitori Associati, Deutsche Bank's RREEF and the Borletti family.

First Atlantic, which is in the process of finalising its merger with Fimit, is also said to be in negotiations to acquire the other Rinascente department store at Via del Tritone in the Italian capital for a price of around EUR 260-270 mln.

The owners of the Rinascente building, Investitori Associati (46%), Deutsche Bank (30%), Prelios (20%) and Borletti (4%) bought it in 2005 from Ifil, the investment vehicle of Italy's Agnelli family. The Milan retail asset generates around EUR 22 mln in annual rents.