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International investments to relaunch real estate development

28 December, Linkedin

The recent news coming from the Italian market are definitely interesting, especially for what concerns the international capitals invested in urban development and requalification operations. Not only assets acquisitions, especially core assets. It’s true that most of these operations take place in Milan, but the fact that the big capitals are investing again to create new products is certainly remarkable. The latest news concerns the joint venture between Varde and Borio Mangiarotti for the implementation of a project for a value of about 250 million euro in the western part of Milan (12 metro stops from Duomo). Then, there are also the project by LendLease on the former Expo area, for which the company is awaiting the results of the Stam trial, and the recovery operation of Santa Giulia. A mighty commitment in terms of requalification for both areas, of strategic importance for Milan.

Then, there is Hines, which is investing in the residential segment, or better, in the “living” segment, offering diversified and specific living solutions. Blackstone continues investing (in the meantime, the company has started disinvesting some assets), Barings, and so on. 2017 will close the corporate market with values close to 10 billion euro, while we’re waiting for the numbers for 2018. The various segments, however, have changed their weights within the real estate offer: logistics is rising thanks to the growth of e-commerce, retail is going down, confirming the same values of 2016. Funds, Italian as well as international, have seen very important acquisitions, such as that by DeA Capital RE SGR for the Edison headquarter in Milan, the single deal of the year, with 272 million euro, along with the operation in Rome for the Scarpellini assets. Always in Rome, the stadium project is finally starting, even though without the office part as initially planned. Moreover, some operations that were on hold are about to restart. From this point of view, it’ unlikely 2018 will be worse than 2017. On the overall, even though the market spins around Milan, 2018 might be the year of the consolidation of real estate at a national level, with a better development approach. Finally, we’ve started seeing new constructions for more houses, a new residential offer that Italy needed so badly.

The political uncertainty, with the elections coming on March as well as the regional elections in Lombardy, is a big factor to determine the trends of the market. According to some, the result will be another Government with a weak majority subject to the President of the Republic and, consequently, to Brussels. Let’s just hope that at least 60% of the Italians will vote, otherwise, this will be another sign of a divided country, with a part of people that don’t trust politicians anymore.

Source: Linkedin

Translator: Cristina Ambrosi

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