It is an investment instrument gathering the financial resources of a group of people who, upon subscription, become holders of a certain number of units (in proportion to the amount of capital invested). During the fund's lifetime, unit value increases or decreases according to the performance of investments made by the fund. The funds can, according to management regulations, distribute returns on investment or not. Each mutual investment fund is an independent estate, entirely separate from the assets of the SGR and of investors and from those of any other funds managed by the same SGR. Under no circumstances can the SGR use public contribution fund assets for its own or others’ interests.

It is a closed-end investment fund involving investments in real estate assets, real estate rights and shareholdings in real estate companies. It transforms property investments, which are generally difficult and costly to trade, into financial assets (units, securities). This instrument allows investors to invest in the real estate sector even with a small capitals, taking advantage of the expertise of professional traders. The law provides that real estate funds must have no less than two thirds of their assets invested in real estate properties, real estate rights and shareholdings in real estate companies. These funds may be classified according to their prospective clients (retail or qualified investors), property acquisition method (contribution or non-contribution) and dividend payout policy (distributing or non-distributing fund)

While non-contribution real estate funds are originally made up of liquid assets that are subsequently invested in real estate assets, contribution funds are – right from their inception – predominantly made up of property assets, which can then produce profits. Considering the above-mentioned characteristics, contribution funds – unlike other real estate funds – enable investors to evaluate the fund property portfolio and profitability already upon subscription of the units. Contribution real estate investment funds may be made up of private or public contributions, depending on the nature of the grantor.

They are closed-end contribution real estate investment funds, comprising properties contributed by INPDAP, the National Insurance Institute for Employees of the Public Administration.

The return on a real estate investment fund mostly consists of profits from property investments. The latter are the result of two factors: the return from rental contracts and capital gains deriving from the sale of properties.

This is not a guaranteed return for the investor. The return target is the objective the fund aims to achieve and above which an overperformance commission may be acknowledged to the SGR. Achieving the return target may depend on uncertain, future events, mostly out of the SGR’s control, such as the tenants’ compliance with contractual obligations, the existence of any occupancy allowances, the possibility to maintain and improve the property Occupancy Rate for the entire duration of the fund and to sell real estate assets at the expected net selling price, the evolution of the real estate and capital markets, the trend of interest rates, tax policies, the cost of any renovation and maintenance work, etc.. This is why actual fund returns may – even significantly – differ from the return target.

The variation (during the year preceding the integral disinvestment of the fund net assets) of the BTP (treasury bonds) gross capitalisation index as recorded by MTS S.p.A. and increased by 0.75%.

The consumer price index for families of workers and employees is one of the three inflation rates calculated by ISTAT. It refers to the consumption of families supported by employees. This index is used for the periodical adjustment of monetary values, such as rents or maintenance cheques for separated couples. The consumer price index for families of workers and employees (FOI) as calculated by ISTAT can be found on the ISTAT website at the following URL www.istat.it.

The unit is a financial instrument that represents the right of investors to partake of fund returns and increase in asset value, to receive management returns distributed by the SGR and any partial unit redemption as established by the SGR’s Board of Directors, and to receive – upon liquidation of the fund – a sum of money proportional to the fund assets subscribed by the investor

No, these real estate funds are reserved for qualified investors. The latter are non-institutional investors who, by virtue of their size and professional competences, are considered as a qualified player. In particular, in Italy qualified investors are retail investors with a turnover exceeding 2 million euros. This distinction depends on existing rules for the protection of the retail segment. The distinction between qualified and non-qualified investors enables the use of quicker and more flexible procedures with the former, as they are expected to be more experienced and skilled.

The Alpha and Beta funds are listed in the MTF Class 2 segment of the Italian Stock Exchange and can be traded as shares.

Investors who do not wish to wait until the fund expiration date may sell their units within or without the MTF segment in compliance with applicable law. Finding a buyer is, however, a prerequisite for disinvestment. Besides, the price at which units can be traded on the MTF may differ significantly from their net unit value as determined by the Board of Directors of the SGR.

These fund units may be purchased – as if they were shares – through any bank.

Lessees are tenants, i.e. those who occupy the property with a rental contract.

Fondi Immobiliari Italiani SGR S.p.A. (Fimit) was created in 1998 by the Italian state-owned Mediocredito Centrale bank (MCC), the Capitalia Bank Group and the INPDAP pension fund. It is an asset management company working in the real estate fund sector

The geographic asset allocation is the geographic diversification of a fund's real estate assets.

L'asset allocation per destinazione d'uso di un fondo immobiliare è la diversificazione del portafoglio immobiliare per le diverse tipologie di destinazione d'uso.

It is the lifetime of the product.

It is the net value of fund assets, i.e. the difference between the fund assets and liabilities as presented in the half-yearly report and financial statements, which are available to the public. This value also takes into account the estimated market value of properties, based on the technical investigations carried out by independent experts, as envisaged by the law on real estate funds.

The Net Asset Value is given by the total net value of the fund divided by the number of units in circulation

The return is the cash amount paid to unit holders. This amount is defined by the SGR’s Board of Directors based on the fund management profits of the financial year in question and/or on undistributed returns relating to the previous financial years, as set out in the fund’s management regulations. .

Real estate fund units are traded on the MTF segment of the Italian Stock Exchange, similarly to shares. Unit sales orders (units may also be traded individually) can be placed from the bank where the units are deposited. Purchase orders may be placed from any bank.

This is the daily price of a real estate fund unit traded on the reference market, reflecting the market supply and demand. The price at which units can be traded on the MTF may differ significantly from their net unit value as determined by the Board of Directors of the SGR.

This is the variance between the book value and the market value of real estate fund units, i.e. between the value at which units are carried on the books of account and the price at which they are traded on the Milan Stock Exchange

The Beta Fund potential investments as defined by the fund’s Regulations may be divided into three classes: Fund assets can be invested in any kind of properties, mainly for use in the tertiary – both management and business-related – and residential sector, and/or in real estate rights over this type of property. At least 50% of properties must be located in Italy and the remainder must be in EU countries. Fund investment may also relate to land with building permit or equivalent authorisation (for construction purposes), or properties in need of renewal, restoration or restructuring. To this end, the SGR will contract out works to major construction companies. Shareholdings in real estate companies. Beta Fund assets can be used to purchase shareholdings in listed and non-listed real estate companies dealing with the purchase, sale, management and renting (with purchase option) of properties and with the acquisition and transfer of real estate rights. Any real estate assets owned by these companies shall be in conformity with the requirements set out by fund regulations for investment. Financial Instruments Fund assets may be invested in financial instruments as permitted by law and fund regulations, within set limits. In particular, and within the limits set by law, fund assets may be invested in units of other Collective Investment Undertakings, both real estate and non-real estate related, also promoted or managed by the same SGR or by other SGRs belonging to the same bank group. The fund can also conduct forward transactions in financial instruments, in compliance with investment limits set out by relevant law and regulations. Finally, fund assets can also be kept available in cash for treasury requirements. Investments can also be made in financial instruments offering quick and safe liquidity.

The maximum borrowing capacity of real estate funds is defined by existing law. This capacity is equal to 60% of the value of real estate assets, real estate rights and shareholdings in real estate companies, plus 20% of all the other assets. Taking out loans for an amount equal to 60% of the value of real estate assets, real estate rights and shareholdings in real estate companies, would – were the fund entirely made up of said assets – lead to a debt amounting to the 150% of the fund’s total net value.

It is a document produced by those who intend to make a solicitation to the public. It contains all the necessary information for investors to get a clear view of the economic and financial situation of the company issuing the financial products being solicited. It is the official document for any solicitation to the public. It is, in fact, a document aimed at investors, containing accurate and detailed information on the soliciting company. To this end, CONSOB has defined a series of rules for drawing up the Prospectus

Management Regulations define participation in the fund. The document is approved by the Bank of Italy, as are any subsequent amendments. These regulations govern the functioning of the fund, while defining the roles of the various parties involved and the relationships with investors. In other words, it establishes the rules to be complied with by the SGR in the management of fund assets.

These are official accounting documents that contain the mix of investments and the value of the fund. The financial statements – or the report produced upon the distribution of returns – are subject to audit by the fund’s and the SGR’s auditing company.

It is the operation whereby the financial instrument is offered to the public (here, real estate fund units). The placement is one of the ways in which, for example, IPOs are made. The placement is generally entrusted to a financial intermediary, who sees to the subscription of securities on the part of investors. Often, the placement is entrusted to a group of intermediaries, who make up a selling group.

A Depository Bank performs various tasks, including the custody of the fund’s financial instruments and cash, and checks on compliance with existing law and regulations of: a) unit issue and redemption operations; b) the calculation of unit value and fund returns distribution; c) operations carried out by the SGR, assessing conformity with law and fund regulations.

The Global Coordinator is responsible for placing the fund and providing the SGR – in charge of listing the financial instruments – with the necessary information and advice. The Global Coordinator is generally a bank.

Independent Experts are qualified professionals (in compliance with legal requirements) in charge of carrying out technical investigations, estimates and periodic evaluations on the property portfolio to estimate the value of real estate assets.

SGRs that intend to list closed-end investment fund units must appoint a specialist, i.e. a financial intermediary whose main task is to support the liquidity of the security

It is a company responsible for auditing the fund’s and the SGR’s financial statements

IPO subscription requests must be submitted via the appropriate subscription form – attached to the Prospectus – to be filled in and signed by the subscriber or by the latter’s proxy. The form also contains a binding commitment to pay for the units being purchased and must be submitted exclusively to the Placement Coordinator. Placement Coordinators are obliged to provide any applicant with the Prospectus free of charge before subscription. Subscription requests are irrevocable and cannot be subject to conditions, except for the right of withdrawal for subscriptions collected outside the registered office or on-line, in which cases the investor may notify – free of charge – the withdrawal to the placement coordinator or financial adviser within seven days of submitting the subscription form, in accordance with Art. 30, par. 6 of the relevant Consolidated Law.

It is the allocation of units apportioned to the individual subscriber in the case of oversubscribed units

As far as Alpha and Beta real estate funds are concerned, no commissions must be paid by subscribers upon the purchase of units within the Global Offer.

In practice, the SGR manages the fund’s assets, choosing the properties to be bought and sold, the investment in cash and securities, the portfolio mix and the distribution of assets among different risk rates. In other words, the SGR is the fund manager. In order to operate it must be authorised by the Bank of Italy, following CONSOB’s approval.