Month: December 2018

Hospitals, shops and hotels for the former Falck area

24 December, Libero

The Falck area in Sesto San Giovanni, which will accommodate Città della Salute (City of Health), requires some radical changes. The City Council gave the green light to the start of the works funded by the urbanisation fees for the requalification project.

The Council has discussed the project for the so-called “Concordia Quarter”, where a shopping district will replace the T5 building. Following the approval of the Comprehensive Planning by the Project Coordinating Unit concerning the technical feasibility of the plan for Concordia, the company Milanosesto will present in June the applications for the building permit.

If everything goes according to the plan, the works may start between 2019 and 2020. City Councillor for urban planning Antonio Lamiranda explains that “the role of the administrative division is finished. Now it’s time to begin the second phase concerning the review of the compliance for the already approved applications. It has been an essential step in the development of the Falck area”.

How the works will proceed

Once completed the administrative procedure for Città della Salute, all the necessary approvals regarding the building permits will be completed. Hence, Milanostesto may start the construction site in Concordia. After that, the urban planning division will begin discussing the Unione area”.

Concordia will have various functions. The main attraction will be the T5 commercial district covering 80 thousand Sq m and the main street featuring shops with a surface of over 120 thousand Sq m. The area will also include services and hotels for the same surface.

The Northern Ring has also got the green light from the administration. It will consist in the new exit “Sesto-Tangenziale Nord” of the motorway for a value of nearly 22 million euro. The Southern Ring (Viale Edison) is worth about 9 million euro, while the related roads and underground parking required by law for 32 million euro.

The entire Flack requalification project implies public works for approximately 231 million euro concerning primary and secondary urban interventions, services and quality standards implementation, along with 5 million euro for the library and the new police station.

Road access

Città della Salute and the new shopping district will also require viability interventions. These will be of the private type as well as public, like squares and streets. Concerning the residential part, 20 thousand Sq m will be destined for regulated housing, 12 thousand Sq m for council houses and 400 thousand Sq m for free construction.

The plan for the new station linking old town Sesto to the new part of the city will be approved shortly. The executive project is pending the approval from the city administration, so that the international call for bids may be launched in June.

The implementation of Città della Salute depends on the tender contract which is meant to be finalised between January and March, and the construction works will start in the following nine months. In the meanwhile, the park will also be implemented. The works will last at least three years.

Mayor Roberto Di Stefano comments: “We’re happy with this further step in the administrative procedures. Everything is proceeding as scheduled, and we’re just at the beginning of an essential process”. The path adopted is destined to become a model.

Source: Libero

Translator: Cristina Ambrosi

Naples: 30 sites to be developed

24 December, Milano Finanza

Real estate in Campania, especially Naples, offers a good potential but also many challenges. Mario Breglia, Scenari Immobiliari founder and president, commented: “It’s the first market in Southern Italy. If we also consider the area around the city, there are about 30 sites to develop, starting from Bagnoli. The estimated investments are 3 billion euro over the next ten years. Unfortunately, the market is burdened by planning and cultural limits”.

The relaunch of Campania and the whole south of the county through the requalification of Naples were the main topic of the “Southern Forum: investing in the territory to relaunch the country” organised by Cassa Depositi e Prestiti which took place in Naples. Marco Sangiorgio, general director for Cdp Investimenti Sgr, stressed that “this territory needs to be revitalised and the old houses have to be adjusted according to the new needs of today’s life. We’re also working on collaborations in order to create legislative and fiscal conditions that are suitable for this kind of operations”. According to Sangiorgi, the requalification of the former tobacco factory in Naples by the Cdp group should be taken as an example by the rest of Southern Italy. Social housing, temporary accommodations, energetic requalification of the existing properties are the most critical elements to work on, as it emerged from the debate when assessing the achievements and the failures of the most recent projects. Among these, there are the almost completed requalification of Mostra d’Oltremare, with the construction of two hotels for the visitors, as well as the requalification of the former cargo station in Salerno to convert it into a judicial district according to the project of the world-famous architect David Chipperfield which will be completed at the beginning of the next year. The requalification of Bagnoli hasn’t started yet, while the Afragola station designed by Zaha Hadid in 2000 and inaugurated in 2017 is still waiting to be linked to the Naples metropolitan network, only then it will be used at its fullest.

Despite all, Naples has performed well in terms of the number of residential transactions and returns of investments. These are set between 4.5% and 6% for residential properties and at 8% for logistics assets, as World Capital Re estimates. As Breglia explained, “the growth of transactions by more than 10.5% in 2018 supported the real estate market of Campania. Of the 33,900 transactions reported by the region, 23% (7,780) concentrated in Naples. Campania is the fastest-growing region in the south concerning residential sales with a 5.6% increase compared to the 2.7% of Basilicata which is second, followed by Puglia with 2.5%”.

Naples is the primary market also regarding the non-residential segments. Logistics shows a good absorption of the existing spaces, thanks to the rise of e-commerce and the interest for the logistic hubs near the city. Medium-sized hubs close to the city are on demand, as they grant agile and quick deliveries. World Capital Re Ceo Andrea Faini warned that “the modernisation of the supply chain concerns the whole Southern Italy. Naples is the ideal spot to accommodate modern logistic facilities. Buyers demand the compliance with the safety requirements. Rents are comprised between 40 and 44 euro/Sq m, while the average returns are set at 8.5%”.

The main hubs, like the Nola freight terminal and the one in Marcianise-Maddaloni (Caserta) named “Sud Europa”, are close to Naples, while one of the biggest logistic hubs in Southern Europe is in Eboli, in the province of Salerno. Caserta has the biggest area covered by logistic assets, 60% of the total according to World Capital. It’s followed by Naples with 27%, Salerno with 10%, and Benevento with 3%. In Barra, Ponticelli, and S. Giorgio in Cremano, Tecnocasa reported an increase in the demand for large-sized spaces from companies operating in the automotive and logistics sectors. “Large spaces are available in San Giovani a Taduccio, where Ferrovie dello Stato freed plenty of them which were previously used for repairs”, explained Davide Agretti, area manager for Tecnocasa in Campania. “We’ve recently reported an increase in the demand for spaces to open private clinics. These generally consist of properties to demolish and requalify. The demand focuses on properties in good conditions or new construction for 600-700 euro/Sq m, while rents start from 24-36 euro/Sq m/year”. The trend registered in the logistic segment had an impact on retail, and this pattern is present also in the other southern regions. “The demand for retail spaces has reduced. Shopping centres are struggling, as they report a high tenant turnover, while services like dental clinics are doing well. It’s becoming harder and harder to find tenants for the vacant spaces”, said Faini. The reasons are obsolete formats and spaces needing an overhaul. One the overall, high street reported good results, thanks to the dynamic demand. For instance, in Naples, rents in Via Chiaia and Via dei Mille are set between 1,010 and 1,450/1,500 euro/Sq m, and the vacancy times are maximum two months. The gross returns are generally comprised between 4.5% and 6% per annum”.

For what concerns offices, there’s plenty of offer, even exceeding the demand. In Naples, as well as in the rest of the region and especially in Caserta and Salerno, the market is mainly driven by local professionals. “In Naples, changing the intended use of a property is rather common, including the conversion of large properties left by public authorities, although such spaces should be renovated before being put on the market.”, continued Faini.

Naples registered a high vacancy rate for offices destined to professional, mainly due to the bad conditions of the properties. As a result, they’re often reconverted into tourist apartments.

Finally, concerning the touristic segment, Faini says that, apart from Naples, “the market is rather lively in prime locations such as Amalfi, Ischia and Capri. The market is fast, although limited, the demand is good, and there is the potential for new investments”.

Source: Milano Finanza

Translator: Cristina Ambrosi

From Ferragamo to Marriott: Milan’s new luxury hotels

24 December, Milano Finanza

Five stars for Milan’s new Renaissance. By targeting upscale international tourism, the city is going on with the restyling in the name of luxury that started in 2015 with Expo. Several projects are about to be completed, despite the possible obstacles of bureaucracy. The investors are mainly international hotel chains already present worldwide using Milan to enter the Italian market. They generally select historical buildings, often of great touristic relevance, centrally located, offering a comprehensive and sophisticated product.

The Hotel Portrait will open in 2020 in the former episcopal seminary of San Carlo Borromeo in Corso Venezia 11. The owner is Lungarno Collection Hotel, a company of the hospitality division of the Ferragamo group. The asset is located in the Quadrilatero fashion district, with an entrance also on Via Sant’Andrea 10. It represents a luxury spot featuring restaurants, a spa, a shopping arcade and an area for events.

The empty building across the Brera art gallery will become Milan’s Soho House, the first Italian location of the international clubs already present in 20 cities worldwide. It will include a lounge bar, a gym, a spa, a swimming pool, a library, a small movie theatre, and a rooftop garden. The club aims at becoming the new meeting point for the creative and business scene of the city.

Meanwhile, the brand Edison will open a luxury hotel in the building near Porta Romana which used to be the electoral office. It will feature 116 rooms, two restaurants, and a spa. Marriott will be a guarantee of its excellent standards. The company owns several high-end hotels in various cities around the world and is an established name in luxury hospitality.

For what concerns low-cost fashion, the Japanese fashion brand Uniqlo will open its first Italian store. The brand operates in 21 markets worldwide with 2 thousand stores, famous its signature line of ultra-light jackets. The store will be inaugurated in spring 2019, and it will develop over three floors covering a total surface of 2,500 Sq m. It will occupy a 20th-century building in Piazza Cordusio not far from Duomo.

Source: Milano Finanza

Translator: Cristina Ambrosi

Record rent for the iconic Prada store in Galleria

24 December, La Repubblica

It was Prada that started a game which saw prices growing and growing. Prada triggered the bid that transformed Galleria into a money machine with its 59 thousand Sq m and 149 shop windows. In 2011, Prada beat Apple obtaining a 4,187 Sq m space from the ground to the top floor occupied at the time by McDonald’s. The brand made the record offer of 5.2 million euro per year for the first five years, which became 9 million with the agreement signed in 2013. Now that the contract is about to expire, Prada will pay to the City of Milan 2.2 million on top of the current yearly rent of 520 thousand euro in order to keep its location. With the new lease, the city administration will achieve incomes for 37.5 million in 2019. They were 26 million at the beginning of the Sala administration, 8.2 million in 2007.

This time, an auction wasn’t necessary to assign the spaces. As City Councillor for Budget Roberto Tasca explains, “the shop belongs to Milan’s cultural heritage”. After all, Prada was born in 1913 right here, from a small shop in Galleria that used sell suitcase, handbags and walking sticks in 1920. The products were so elegant, that Mario Prada ordered the mahogany and brass furniture from Pollard Padd in London, while the famous Scala theatre scenographer Nicola Benois created the two large panels.  These elements are still in the shop. As a result, the Ministry for Culture started a procedure to preserve the shop.

Following the same logic that forced the City of Milan of repeating the call of bids for the spaces of Gatto Rosso and Salotto, considering their historical value, the city administration decided to renew the lease for other 12 years. As Tasca remarks, the new contract “will be more convenient for the City administration, pursuing the road of preservation of the cultural heritage which has given excellent results so far, with the benefit of the city finances”. Moreover, the appeal of Galleria keeps growing thanks to the tourist and the international hype of Milan. Fashion brands are willing to pay high rents to secure a spot between marbles and frescoes. The latest offer comes from Moncler which will replace Urban Center. The brand had more than doubled the auction starting price for 1.2 million by bidding 2.5. Before that, Yves Saint Laurent offered raised the auction price from 131 thousand euro to one million for an 80 Sq m space with just one window. That’s the same money paid by Cracco for its multifloored restaurant. Tasca endorses this process: “the more we earn from Galleria, the fewer Milanese will have to pay. Galleria is open also at night. For me, the shopping centre option is not that bad as someone else say”.

Source: La Repubblica

Translator: Cristina Ambrosi

Kryalos Sgr acquired two office buildings in Rome

28 December, Linkedin

The Honos fund of Kryalos Sgr completed the acquisition of two prime buildings in Rome, close to Quirinale, entirely leased to IVASS (Istituto per la Vigilanza sulle Assicurazioni), the surveillance authority on insurances. Kryalos Ceo Paolo Bottelli commented: “With this operation, we’re closing 2018 with acquisitions by Kryalos for 1.2 billion euro, allowing us to reach managed assets for 5 billion euro”.

Source: Linkedin

Translator: Cristina Ambrosi

World Capital takes over from Fap Invest two logistic assets for 100 thousand Sq m

22 December, Milano Finanza

World Capital completed the sale of two logistic assets for 100 thousand Sq m owned by the real estate development company Fap Investments. The portfolio was acquired by DWS Group GmbH & Co. KGaA, the asset management division of Deutsche Bank on behalf of a managed real estate fund. The two assets accommodate Arcese Trasporti and the new Decathlon logistic hub. The facilities have been recently constructed, and they offer the highest quality standards. They feature photovoltaic panels covering 40-50% of the energy requirements.

Source: Milano Finanza

Translator: Cristina Ambrosi

doBank is about to conclude the negotiations with Altamira

21 December, Milano Finanza

The negotiations between doBank and Altamira are at an advanced stage. According to El Confidencial, doBank, the financial company operating in NPL management and collection on behalf of banks and companies, is about the close a deal concerning the purchase of the leading Spanish servicer, Altamira, the former platform of Banco Santander. The platform is owned for 85% by funds such as Apollo, CPPIB and ADIA and 15% by Santander.

doBank is allegedly the favourite candidate to acquire the company after that Intrum withdrew from the competition to focus on Solvia, the NPL platform of Banco Sabadell. While the funds are open to selling, it’s still not clear whether Santander will also sell its holdings since Altamira manages a part of its assets. Altamira operates in Portugal, Cyprus and Greece, where doBank has recently won a servicing mandate concerning NPLs for 1.8 billion euro.

In 2017, Altamira had 700 employees and an NPL stock of about 50 billion euro backed by over 82,000 real estate assets. Moreover, it had about 15 long-term clients, including Santander and Sareve (the NPL national fund) representing approximately 30% of its assets under management. Nine billion of the assets under management are located abroad, mainly in Portugal (Oitante, 1.5 billion euro) and Cyprus.

The rumours talk about an offer for 500-550 million euro, although the initial estimate was for 600 million, for a player with assets under management for 55 billion between non-performing loans and real estate assets. As stressed by Equita in its analysis, the estimated purchasing price might be lower than the amounts generally paid for the Italian platforms, although it refers to a more mature market.

As the analysts estimate, “we don’t know the financial data of Altamira, but assuming fees are lower than in Italy, we estimate Altamira might generate at Ebitda of approximately 45 million euro”. At this stage, the leverage will reach the maximum level set in the business plan, namely three times the net debt/Ebitda ratio, or slightly over.

According to the Equita analysts, the acquisition of Altamira might have a strategic relevance since it will allow doBank to the enter the Spanish servicing market (NPLs for over 200 billion between primary and secondary market) with a leading position and to enter interesting countries such as Cyprus and Portugal, without the need to acquire local platforms. Banca Akros adds: “it would be a significant step forward in the doBank’s three-year business plan. It will allow the company to enter primary markets, as Spain and Portugal, re-leveraging the accounts”.

However, Equita warns that “the risks might be very high and the potential synergies with Italian activities very limited”. Equita confirms its hold rating and the target price of 11.60 euro, while the rating by Banca Akros is to buy and a target price of 12.50 euro. The doBank shares reported a -2.21%and are traded at 8.85 euro after the company announced yesterday to have obtained a mandate from Iccrea as a special servicer as well as a master servicer for an NPL portfolio of a book value equal to 2 billion euro, 70% of which secured.

The portfolio is composed of 10 thousand holdings (the average book value is 200 thousand euro). The operation is aligned with growth trend reported by the company already in the first semester of 2018, after having won three mandates for NPL amounting to over 3 billion (with completed operations for 2.7 billion with Banca Agricola Popolare di Ragusa, Carige and Iccrea).

The Equita analysts say that “thanks to this deal, our estimate concerning deals in 2018 equal for over 17 billion is almost achieved”. “The news is definitely positive, as it improves the 2019 outlook, and it shows how the company can successfully meet its targets”.

Source: Milano Finanza

Translator: Cristina Ambrosi

Five international teams for Farini and San Cristoforo. Works are about to start on Milan’s old rail yards

22 December, Corriere della Sera

Five international teams have been selected out of fifty candidates to design the requalification project of the former Farini and San Cristoforo rail yards. One group is headed by the Italian studio Baukuh, a very young (everybody is below 40 years of age) and innovative team, known for the project of the House of Memory. There is the Dutch Oma of Rem Koolhaas (famous in Milan for the Prada Foundation), and Arup Italia together with the Norwegian Snohetta, the creators of the “new” Times Square and of the Library of Alexandria. There is also the internationally-known team of Kengo Kuma from Japan, as well as that of Nicholas Grimshaw, one of the leading exponents of contemporary British architecture.

The teams are transversally and internationally organised. They will have to combine several skills: from landscaping to business and urban planning. They will compete to access the bid launched by Fs Sistemi Urbani and led by Carlo De Vito and Coima Sgr with Manfredi Catella. The five teams will work on the masterplan. In April, a panel headed by Dominique Perrault (the architect that signed the Olympic district in Paris) and supervised by Leopoldo Freyrie will nominate the winner which will be awarded 50 thousand euro, besides a reimbursement of 25 thousand granted to all the participants. At that point, the masterplan will be evaluated by the public and the structure of the plan will be ready by the summer.

The masterplan will be presented to the market to find partners, sponsors and developers. The works will start in 2021, but the area will accommodate the Fine Arts campus, also known as Brera 2, starting already from next year. The Academy will be temporarily located in a warehouse occupying an area of 25 thousand Sq m. It will accommodate lecture halls for 1,500 students and an exposition area. The team implementing the masterplan, however, will have to include other 10 thousand Sq m for its expansion.

The call for tenders concerns two portions of Farini (one public and the other private, facing on Valtellina) as well as the San Cristoforo. This latter will become an “urban oasis”, as it will be entirely occupied by green spaces, while 65% of Farini (600 thousand Sq m in total) will be covered by parks. About 400 thousand Sq m of buildable area will be destined to housing, including rents at regulated prices destined to people under 35 years. There will also be a district occupied by public offices for a total of 70 thousand Sq m expandable to 110 thousand Sq m to accommodate 6,500 employees. The district will rise in an area propriety of the City of Milan in Via Cenisio right beside the tracks. The project is valued 200 million euro, and it’s meant to gather all the local offices. The small area owned by Coima Sgr (60 thousand Sq m towards Via Valtellina) might see the arrival of Istituto Marangoni, Naba and Domus Academy.

The seven rail yards cover a total area of one million and 250 thousand Sq m in a strategic position. Besides Farini, there is Greco (the project and the winner will be disclosed on February) and Porta Romana. For this latter, the bid will be published in the second half of the year, and it might host the Olympic village in case Milan wins the 2026 Olympic games. Finally, Porta Genova will host temporary activities.

Source: Corriere della Sera

Translator: Cristina Ambrosi

The Region of Sardinia to auction five assets on the coast

22 December, Milano Finanza

The Region of Sardinia has recently published the first five call for bids concerning the assignment for requalification purposes of real estate assets on the coast. The assets are the former lighthouse of Capo D’Orso (Palau), the old signal station of Capo Sperone (Sant’Antioco), the former streetlight station of Capo Ferro (Arzachena), the previous lookout post of Capo Figari (Golfo Aranci), and the former signal station of Punta Falcone (Santa Teresa di Gallura).

The auction will select the most convenient commercial offer. Once obtained one or more assets, it will be necessary to recover them through highly-skilled interventions to use them for hospitality and touristic purposes. The documentation required to participate at the bid is available on the website of the Region of Sardinia www.regione.sardegna.it.

Source: Milano Finanza

Translator: Cristina Ambrosi

Sga: binding offer for the securitisation of NPLs for 314 million from Banca del Fucino

21 December, Reuters

Sga, the company of the Ministry of Treasury managing bad loans amounting to 20 billion, presented a binding offer to Banca del Fucino to organise a securitisation of an NPL portfolio for a nominal value of 314 million.

The news was disclosed through a memo specifying that the portfolio is composed for 211 million by NPLs and by UTPs and past-due for the remaining 103 million.

Sga will act as a master and special servicer for the securitisation by subscribing the equity tranche.

The completion of the operation is scheduled for the first quarter of 2019, considering that the merger of Banca del Fucino and Igea Banca will happen in the same period.

Source: Reuters

Translator: Cristina Ambrosi