15 March, Corriere della Sera
They don’t give high returns, less than 3%, but they’re the most desirable commercial properties for big investors. They’re the high street shops in the big cities such as Milan, with Quadrilatero and Corso Vittorio Emanuele.
Last year the transactions for showrooms in the high streets exceeded those for shopping centres and retail parks: of little less than 2.5 billion investments, almost 1.4 have been invested in high street, while investments for shopping centres have been 750 million and retail parks 250 million.
This trend seems to be stable for other two reasons. Firstly, the high street sector is very little impacted by the economic situation (even in the worst times of the recession, Via Montenapoleone was crowded with wealthy foreigners), while the earnings of shopping centres are closely related to the economic trends. Secondly, the products sold in high streets are generally not available online, while shopping centres have to compete with e-commerce.
Shops in Milan are keeping their real estate value. In fact, comparing the average selling prices of three years ago and the current price, we can note the values are positive (starting from Montenapoleone with +20% and Corso Vittorio Emanuele with +9%) during a period that saw the values of the other property types reducing.
According to Reag (Duff & Phelps), the most significant transactions in the city recently concluded are the sale of the Diesel flagship store in Piazza San Babila for 93 million (bought by Drc Capital), as well as the sale to Amundi of a mixed-use property which includes the Disquared and La Martina shops in Via Verri 4, for 92 million euro. Other mixed-use properties have been sold by Zunino to Castello in Via Biglia and Via Bagutta for 128 million euro. This doesn’t mean that the era of shopping centre is over. After the inauguration of City Life last year, the biggest shopping centre in the centre of a provincial capital in Italy, there are other two important initiatives coming up.
The first initiative concerns Cascina Merlata, north of Milan, where 192 shops will rise on a surface of 65 thousand Sqm. The project is included in the requalification plan of Expo 2015, where the Human Technopole will also rise. The second project has even bigger dimensions: 185 thousand Sq m, 1.4 billion invested, 380 shops. It’s the Westfield in Segrate which will open in 2020 (the project has been delayed by three years). Following the model of the shopping centre already opened in London, it will be a mecca for luxury and leisure, bringing in Italy for the first time Le Galeries Lafayette, aiming ambitiously at bringing the showrooms of fashion brands in a shopping arcade.
Source: Corriere della Sera
Translator: Cristina Ambrosi