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PARIS-Bail Investissement, a REIT-style subsidiary of locally based Fonciere des Region, is acquiring a 67.5% stake in Technical SAS, owner of an 11.13-million-sf portfolio of mixed-use offices and light industrial properties leased to France Telecom. The portfolio is valued at euro 1.6 billion ($1.88 billion).The seller is the CGW consortium, which consists of CDC Ixis, GE Real Estate France and Goldman Sachs Whitehall Funds. Bail will acquire Technical's entire capital from CGW and then sell to GE REF mandatory convertible bonds issued by Technical that will eventually give GE a direct stake of 32.5%. In addition, Technical's debt will be refinanced through a new euro 950-million ($1.12-billion) bank loan. The properties in the portfolio are leased to France Telecom. The lease expires in 2011. The annual rental revenue is euro 124 million ($146.27 million), about half of which comes from properties in Paris. The transaction will double Bail's managed portfolio and boost its presence in Paris and other urban centers. Bail estimates its return on this latest investment at just below 8%, saying is will increase overall profitability and be immediately accretive to current cash flow per share, lifting it by around 30%. The new portfolio will be managed by dedicated teams from Groupe Fonciere des Regions. Last week, Groupe Fonciere des Regions entered the property market in Germany with the acquisition of interests in three property companies that own a combined 5,300 housing units in this city. Fonciere des Regions purchased the interests from Immeo, a subsidiary of a fund jointly managed by Morgan Stanley Real Estate and Corpus.