Only a few people are optimistic about the situation of real estate in Italy. As we approach the year-end, the operators start making conclusions and forecasts. Many are talking about a significant slowdown of the Italian market. There are several operations in standby, partly due to the dangerous variations of the spread. National and international players prefer waiting to see how the political situation will evolve. Bids have been postponed awaiting better times, most likely in 2019. Cushman & Wakefield forecasts investments for 8-9 billion by the end of the year, with a decrease between 10% and 30% in comparison with 2017.
The operations of three major banks (Mps, Banco Bpm, Popolare di Vicenza) are paused. Mps was meant to launch the sale of assets for one billion euro, but there is no information in this regard. The same for Banco Bpm for its instrumental and non-instrumental assets worth 700 million, as a first analysis detected a significant unbalance between market values and book values. Banca Popolare di Vicenza was meant to sell its real estate portfolio valued 400 million euro this summer.
Concerning offices, there is no news concerning the bid launched by Lazard for the assets owned by Enel that the bank was intending to close by the end of the year. The portfolio also includes offices for a total value of 250-260 million euro, but Enel requested the potential buyer to spend about 150 million in capital for their requalification.
Finally, regarding retail, Blackstone is about to sell its Italian outlets for a total value of approximately 800 million euro, but it’s hard to tell the outcome.
The luxury property market is thriving in Milan and Rome, especially for what concerns new construction. Engel & Völkers and Nomisma reported hiking prices, reaching 15 thousand euro/Sq m in Milan in Quadrilatero and 12 thousand euro/Sq m in the Rome old town.
The development project Aurora, near CityLife in Milan, has already sold 30% of the apartments. The project is promoted by the partners Värde, Borio Mangiarotti and Sigest, and it consists in 140 houses in three buildings over an 11,200 Sq m surface.
Concerning transactions, Ardian, with the assistance of Prelios, sold two office buildings in Milan for a total surface of approximately 23,500 Sq m. The sale follows the requalification of the buildings to reduce the vacancy rate. DeA Capital RE Sgr acquired the prestigious Palazzo Aliverti in Milan from Savills for an undisclosed amount. The real estate complex is leased to the Legance offices.
The construction site for Spark One by Risanamento in Santa Giulia, Milan, was inaugurated in the past month. The project aims at relaunching the area with the creation of a new business district. Spark One will be the first Well–certified building in Italy.
Investire Sgr purchased on behalf of international investors three shopping centres in Lombardy, which were sold by BNP Reim Sgr. The properties are Metropoli in Novate Milanese (87 shops and 31,000 Sq m GLA), Settimo Shopping District in Settimo Milanese (27 shops and 9,725 Sq m GLA), and Le Rondinelle in Roncadelle (78 shops and 37,000 Sq m GLA).
AEW acquired for 22 million euro a building in Via del Corso in Rome previously occupied by H&M. The property has a commercial surface of 875 Sq m developed over five floors. The property is currently available and has great potential since the area attracts over 35.8 million visitors every year.
Ikea is about to open a megastore in Rome-Ostiense in partnership with Eataly. The store will be linked to the existing Eataly flagship store. The new strategy of the Swedish brand consists in launching smaller shops in city centres to beat the competition of online shopping.
The real estate broker Edares-Real Estate Solutions completed two important deals concerning lease on behalf of Rolex and Saint Laurent. The first concerns a single-brand store in Rome for over 200 Sq m of surface. The second regards a shop located in Venice with a surface of 400 Sq m developed over two floors.
AnaCap acquired Italian NPLs in two separate portfolios for a total value of 225 million euro. Both portfolios mainly consist of SME loans backed by real estate. The first portfolio (141 million) was acquired from Volksbank, the second (84 million) was sold by Banca di Pisa and Fornacette Credito Cooperativo.
Meanwhile, Creval transferred to Credito Fondiario a secured NPL portfolio worth 220 million, meeting in this way its de-risking goals for 2018.
Finally, Bcc Banca Patavina presented its plan for the transfer of an NPL portfolio valued 150 million euro to Hoist Finance. The remaining stock of 20 million will be managed in-house.
Concerning UPTs, Carige formalised the agreement with Bain Capital Credit for the transfer of UTPs for 400 million. The operation will bring the Npe stock below the target of 4.6 billion as agreed with the ECB.
Mps launched the auction for two separate NPL portfolios (Merlino and Morgana). Merlino concerns the transfer of secured and unsecured NPLs amounting approximately to 2.5 billion. Morgana consists of bad loans for 1.1 billion. However, the spike of spread fosters the tensions in the banking sector, and the Government is evaluating a possible merger of Mps. It would mean diluting the state-owned 68% of Mps with a bank selected among Ubi, Bper or Banco Bpm, creating in this way the third Italian bank and complying with the commitment of privatising Mps by 2021, as agreed with the EU.
Finally, Banco Bpm postponed the deadline for the Ace operation to 14th November. The bank had already selected three possible candidates for the NPL portfolio valued 8.5 billion.
Bulgari will open its second hotel in Italy. The luxury brand, in partnership with Marriott International, will bring to new life the old palace formerly occupied by the INPS offices in Piazza Augusto Imperatore, opposite to the Augustus Mausoleum in Rome.
The requalification of the old liberty-style Borletti factory in Milan has started. The company Al.si.co. Slr, which owns the property, aims at preserving the original features to create 96 apartments.