07 July, Milano Finanza
According to Mario Breglia, Scenari Immobiliari president, property funds are expected to report a double-digit growth this year between 10 and 15%. Offices will be once again the main drivers of the sector, together with residential properties. “The political changes don’t seem to have impacted the strategies of the players so far. On the contrary, we believe that in the next three years the sector will grow even further, with more funds and more product diversification”, he explains.
What was the data the surprised you the most and why?
Property funds are growing more than the real estate market. This trend is global, and Italy is no exception. It means that investors appreciate professional management, and the results are better than the market average.
The future looks good: is it too early to suppose a double-digit growth in the next years?
This year we’ll definitely close with a double-digit growth. Concerning the future, there are too many variables to make a prediction. Asset management gets stronger in a climate of general uncertainty, and it represents an excellent asset class. Should the uncertainties increase in the next years, the scenario will get more confusing.
In your opinion, where the growth of the sector will originate from? From offices, houses or somewhere else?
Offices are traditionally the funds’ favourites. Buildings with one or just a few tenants reduce the complexity of managing them and allow durable performances. Residential is one of the emerging segments, especially short-term rentals to some specific categories such as students or managers. However, we must design a new product regarding form and management, and there’s a lot to do in Italy in this matter. Asset management companies work with skilled and efficient developers, but only a few companies are operating in real estate management with a modern view.
Might foreign investors contribute in reaching this objective?
Foreign companies are still marginal in Italian property investments, although the percentage is destined to grow.
In your opinion, what is the Italian market lacking in comparison with the European one?
The economic recession and the crisis of real estate have reduced the developments, and the territorial requalification objects to the bare minimum, while these are two primary aspects in Europe. There are no opportunities to constitute funds on big projects. They can be found only in single properties, with the risk of paying them too much.
What is your advice or request to the new Government?
As international investors are currently considering investing in real estate in Italy, we must incentivise urban development projects, which won’t find the necessary resources on the domestic market. Of course, it’s not possible to implement such plans everywhere in Italy. Nevertheless, not obstructing this process would be already a beginning.
Source: Milano Finanza
Translator: Cristina Ambrosi