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