Apollo Management LP agreed to buy Citigroup Inc.'s real estate investment unit in a move that will more than triple the value of the private-equity firm's property assets, a person with knowledge of the deal said.

The purchase of Citi Property Investors will give Apollo, of New York, 65 real estate investments in 26 countries with a net asset value of $3.5 billion, the person, who asked not to be named because the negotiations are private, said Tuesday. Apollo's global head of real estate, Joseph Azrack, helped assemble the portfolio when he led the Citi unit from 2004 to 2008.

The sale to Apollo shows the unit's limited partners have confidence in the buyer and a recovery in global prices, said Matthew Anderson, partner at Foresight Analytics LLC in Oakland, Calif. Global commercial property values have plunged since their 2007 peak, dropping 41% in the U.S. through last year, according to Moody's Investors Service.

Citigroup, 27%-owned by the Treasury Department, has been under pressure from regulators to sell assets to shore up its balance sheet. The bank valued the property division at $12.5 billion as of June, according to its Web site. The unit is part of Citi Holdings, the businesses Chief Executive Vikram Pandit said he would sell, wind down or restructure.

Kelly Nugent, an outside spokeswoman for Apollo, and Shannon Bell, a Citigroup spokeswoman, declined to comment.

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