investing in Milan

CityLife Milan: Redefining Urban Living in the Heart of Italy’s Fashion Capital

By Columbus International,22 July 202422 July 2024

In the bustling metropolis of Milan, a revolutionary urban development is reshaping the city’s skyline and redefining the concept of modern living. CityLife Milan, an ambitious project spanning an impressive 366,000 square meters, is setting new standards in urban planning and architectural innovation.

The Future of Urban Development

At its core, CityLife Milan represents a bold vision for the future of urban spaces. This meticulously planned development seamlessly blends public and private sectors, creating a harmonious ecosystem that caters to both residents and businesses. The project’s innovative approach challenges traditional city planning norms, offering a glimpse into the future of urban living.

A Skyline Transformed

The development’s crown jewels are three towering commercial structures that dominate the Milan skyline. These architectural marvels serve as more than just office spaces; they are the heartbeat of CityLife, around which the entire project revolves. Their striking designs not only symbolize modernity but also act as a beacon for Milan’s economic ambitions.

Redefining Residential Living

Surrounding these commercial giants are clusters of residential buildings that redefine luxury living. These homes are not mere afterthoughts but integral components of the CityLife vision. Each residential complex is a testament to contemporary design, offering residents a unique living experience that seamlessly integrates with the development’s commercial and public spaces.

Green Spaces: The Lungs of CityLife

In a refreshing departure from typical urban developments, CityLife Milan places significant emphasis on public green spaces. These areas are not just aesthetic additions but are crucial to the project’s holistic approach to urban living. Lush parks and carefully landscaped gardens serve as communal retreats, offering residents and visitors a much-needed escape from city life.

The Economic Implications

CityLife Milan is more than just an architectural feat; it’s a strategic investment in Milan’s future. The project is poised to attract international businesses, boosting the city’s already formidable economic status. Moreover, it’s likely to spark a real estate boom in surrounding areas, potentially reshaping Milan’s property market.

A Model for Future Cities

As urban populations continue to grow globally, developments like CityLife Milan offer valuable insights into sustainable urban planning. Its integrated approach to combining commercial, residential, and public spaces could serve as a blueprint for future city developments worldwide.

The Bottom Line

CityLife Milan represents a bold step into the future of urban development. By reimagining the relationship between commercial spaces, residential areas, and public domains, it sets a new standard for city planning. As the project continues to evolve, it will undoubtedly cement Milan’s position as a leader in innovative urban design and sustainable living.

For investors and urban planners alike, CityLife Milan is a project to watch closely. It may well be the harbinger of a new era in urban development, one that prioritizes holistic living experiences over mere functionality. As cities worldwide grapple with the challenges of urbanization, CityLife Milan stands as a shining example of what’s possible when vision meets execution in the realm of urban planning.

Photo via City-Life

Milan: Real Estate Market Evolves Amidst Stability and Growth

By Columbus International,5 July 2024

Milan’s real estate market continues to demonstrate remarkable resilience, with contrasting dynamics between the sales and rental sectors. According to the latest report from idealista’s Research Department, Italy’s leading real estate portal, housing prices in the Lombard capital have stabilized in the spring quarter of 2024, settling at an average of €4,987/m².

Key points:

Stability in Milan’s sales prices (+1.4% year-on-year)
Continued growth in rental rates
Variable dynamics across different neighborhoods

Market analysis:

The Historic Center remains the most expensive area at €10,311/m²
San Siro-Trenno-Figino leads quarterly increases (+3.3%)
Vialba-Gallaratese records the most significant decline (-4.8%)

In the hinterland, a slightly negative trend is observed, with a 1.2% decrease and an average of €3,389/m². Assago emerges as the most expensive municipality (€3,647/m²), while Grezzago offers the most accessible prices (€1,054/m²).

The rental market, on the other hand, continues its upward trajectory. A 55-square-meter apartment in the heart of Milan now costs an average of €1,760 per month, highlighting increasing pressure on the rental market.

Andrea Napoli, CEO of Locare, offers insight: “The lack of adequate protections is pushing landlords towards short-term rentals, drastically reducing the supply for long-term residents.”

Key factors influencing this trend:

High purchase prices
Interest rates that remain elevated
Growing demand for tourist rentals

The future of Milan’s real estate market remains uncertain, but it’s clear that the city is undergoing a transformation phase, presenting both opportunities and challenges for investors and residents alike.

Real estate investments in Milan. An in-depth market analysis and numerous tips from Corriere della Sera

By Columbus International,27 June 202427 June 2024

In an ever-evolving real estate market, Milan continues to be one of the most attractive locations for investors. A recent study reveals that about 20% of real estate transactions in the Lombard capital are aimed at generating income. But how truly profitable is investing in Milan’s brick and mortar? Il Corriere della Sera has conducted a detailed analysis to shed light on this trend.

Comparing Returns: Real Estate vs. Government Bonds

To assess the actual profitability of real estate investments, we compared Milan’s rental yields with those of 8-year Italian Government Bonds (BTPs), currently at 3.2% net. Our analysis is based on standard 8-year free-market rental contracts, assuming a reliable tenant and regular payments.

The Milan Landscape: Data and Figures

Based on data provided by immobiliare.it, we examined a typical 70 m² apartment:

Average purchase price: €378,000
Monthly rent: €1,631
Gross yield: 5.17%
Net yield: 3.36%

It’s important to note that the net yield, considering taxes and expenses, is only slightly higher than that of BTPs, but carries significantly greater risks.

The Geography of Returns

Our research highlighted considerable disparities between different areas of Milan:

Historic center: 2.3% net yield
Premium areas (> €350,000 for 70 m²): yields lower than BTPs
Peripheral areas like Baggio and Ponte Lambro: yields up to 4.6% net

Milan’s Hinterland: An Interesting Alternative?

Extending the analysis to the province, surprising data emerges:

Average yield: 6.8% gross, 4.4% net
Top 3 for monthly rents: Gorgonzola (€1,156), Vimodrone (€1,084), Segrate (€1,075)
Municipalities with the best yields: Turibigo, Truccazzano, Tribiano (> 6% net)

These data suggest that the hinterland could offer more profitable investment opportunities compared to the city center.

Short-Term Rentals: The New Frontier?

The short-term rental phenomenon is gaining ground, promising higher gross returns. However, management costs, taxes, and platform commissions significantly erode margins. The profitability of this model seems to be limited mainly to specific areas of Milan.

Conclusions for Investors

Real estate investment in Milan can still offer interesting returns, but it requires careful risk assessment and deep knowledge of the local market. Investors should consider:

Location as a key factor for profitability
The potential for capital appreciation in developing areas
Management and maintenance costs, especially for short-term rentals
The financial stability of tenants for long-term rentals

In a market characterized by high prices and compressed yields, due diligence and a well-thought-out strategy are more crucial than ever for real estate investors in Milan.

Source: Corriere della Sera

Milan’s Next Cultural Powerhouse: Scirocco Hub Signals Urban Renaissance

By Columbus International,24 June 20249 November 2024

In a bold move set to redefine Milan’s cultural landscape, Lendlease and Mare culturale urbano have joined forces to birth Scirocco, a cutting-edge cultural hub in the burgeoning Milano Santa Giulia district, reports Il Sole 24 Ore. This 500-square-meter hybrid space, nestled within the Spark Business District, represents a fusion of art, commerce, and community engagement.

Positioned strategically in the Spark 3 building, Scirocco aims to become a vibrant nexus for cultural, musical, and sporting events, accessible to all Milanese citizens. Andrea Capaldi, the visionary co-founder and artistic director of Mare culturale urbano, envisions Scirocco as more than just a venue. “We’re creating a social and cultural beacon,” Capaldi asserts, “a space that will resonate with both current residents and future inhabitants of this evolving neighborhood.”

This innovative project is a cornerstone of Lendlease’s ambitious urban regeneration initiative for Milano Santa Giulia. Spanning over one million square meters, this development is poised to become one of Italy’s most significant urban renewal endeavors. At its heart lies a sprawling urban park, surrounded by a carefully curated mix of public amenities and services tailored for both individuals and businesses. Claudia Imparato, head of fund & asset management at Lendlease Italy, exudes confidence about the partnership’s potential. “Scirocco transcends the conventional notion of an artistic or retail space,” Imparato explains.

“It’s engineered to be a catalyst for social cohesion and inclusivity, fundamentally reshaping the neighborhood’s DNA.” Industry insiders view Scirocco as merely the opening salvo in a series of transformative projects slated for Milano Santa Giulia. This district is on track to emerge as a dynamic new hub in Milan’s southeastern quadrant, challenging traditional urban living paradigms and setting new benchmarks for city development. As Milan continues to cement its status as a global design and fashion capital, projects like Scirocco underscore the city’s commitment to cultural innovation and community-centric urban planning. It’s a clear signal that Milano is not just preserving its rich heritage, but boldly reimagining its future.

Source: Il Sole 24 Ore

Milan, real estate prices on the rise with several surprises, from Garibaldi to Moscova, from Porta Nuova to CityLife

By Columbus International,8 May 20248 May 2024

According to analyses by the Tecnocasa Group Research Office, residential property prices in Milan increased by 0.1% in the second half of 2023, bringing the overall annual growth to 0.3%.

Central areas like Garibaldi, Moscova, Porta Nuova and CityLife witnessed a 2.1% surge in values, being highly sought-after by domestic and international buyers looking to live, work and study in the city. Demand concentrated on spacious properties exceeding 200 sq.m, with multiple bedrooms, outdoor spaces and top floor units.

The highest prices, peaking at €15,000/sq.m for sales, were recorded in the Porta Nuova district. Some semi-central neighborhoods like Lambrate, Navigli and Famagosta experienced a slight price decline, partly attributable to the abundant supply of new constructions. However, the rental market remained vibrant, with average monthly rents of €1,500 for a two-room apartment in central zones. The Vercelli-Lorenteggio macro-area saw a 1.6% price hike, fueled by growth in Lorenteggio-Frattini and Tolstoj. The Lodi-Corsica area witnessed a 1% increase, propelled by ongoing works for the Olympic Village development. Modest declines were observed in the Bovisa-Sempione (-0.7%), Central-Station (-1.6%) and Navigli (-0.5%) macro-areas, with varying trends across different neighborhoods. The Bovisa district was bolstered by the Scalo Farini redevelopment project.

Prices remained largely stable in the Città Studi-Indipendenza area, with localized increases along Viale Abruzzi and Corso Buenos Aires. Rental demand remained robust, driven by students and non-resident workers. In summary, Milan’s real estate market experienced modest yet consistent growth in 2023, underpinned by the central areas and large residential units, while exhibiting heterogeneous dynamics across various semi-central neighborhoods.

Source: Monitor Immobiliare
Photo: CityLife Residences

Rental Price Surge During Milan Design Week

By Columbus International,26 April 202426 April 2024

The Milan Design Week, an event of international renown, has recently rekindled the spotlight on the Lombard capital, attracting a vast and passionate audience of design enthusiasts from every corner of the globe. The record-breaking 62nd edition saw the participation of over 2,600 exhibitors and the influx of 600,000 visitors, registering a 15% increase compared to the previous year. This success was evidently reflected in the city’s rental market, where housing prices experienced a vertiginous surge.

Data provided by the property management company Italianway, specialized in short-term rentals, and reported by Il Sole 24 Ore, reveals that the average daily rate for an apartment in Milan during the 2024 Design Week was €386, with a peak of €414 on the night of April 17th, marking a 7.5% increase compared to 2023. But how much can a week’s rental cost during this event? For a studio apartment, the average cost hovers around €1,354, while for a one-bedroom apartment, the figure rises to €2,030. For larger apartments with three bedrooms or more, the expenditure easily exceeds €2,700. The highest prices are recorded for luxury apartments in the city center, which can reach the considerable sum of €7,000 per week.

A veritable boom that has made fortunes for property owners but has put a significant strain on the wallets of those seeking accommodation during the Design Week period. Several reasons contribute to explaining this surge in rental prices. Firstly, demand significantly exceeds supply. The event attracts visitors from all over the world, many of whom are willing to pay high prices for accommodation situated in the heart of the city, close to exhibition venues and collateral events. Secondly, the supply of available rental apartments is limited. Not all property owners decide to rent out their homes during the Design Week, and those who do often apply higher prices to take advantage of the high demand.

Source: Immobiliare.it

Florence: the heart of real estate investment still beats. Here’s what emerges from a Tecnocasa study

By Columbus International,1 April 20241 April 2024

The real estate market in Florence continues to attract investors, as revealed by a recent study conducted by Tecnocasa. In 2023, 23% of property purchases were made for investment purposes, a figure higher than the national average of 19.5%.

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However, Florence ranks below other Italian cities such as Verona, which boasts a significant 43.1%, followed by Naples (41.2%), Palermo (35.3%), and Milan (35%). The most active age groups in terms of real estate investments are those between 45 and 64 years old, representing 59.2% of the total, with an increasing average age compared to 2022. The two-room apartment remains the preferred housing type for investors, chosen by 38.5% of them, followed by the three-room apartment at 26.9%. The majority of buyers, accounting for 63%, are couples and families, while 37% are single individuals. The latter group has seen a significant increase in market share compared to the previous year, rising from 32.4% to 37%. 81.5% of investors purchase properties paying in cash, while only 18.5% opt for bank financing.

This percentage reflects a further decline compared to previous years, in line with the national trend, attributed by Tecnocasa to the progressive increase in interest rates, prompting investors to avoid bank loans. According to Tecnocasa, in the past year, there has been a further decrease in real estate purchases through mortgages, as the rise in interest rates has encouraged investors to prefer direct purchases without the assistance of financial institutions.

Rental opportunities on the rise. From Milan to Florence, it’s the perfect time to invest in Italy (Immobiliare.it)

By Columbus International,19 March 20249 November 2024

The rental costs in the main Italian cities have become so high as to exclude both individuals and families with a single income. It’s interesting to note that it’s not Milan, but Florence, that emerges as the least accessible city for those seeking a two-room apartment for rent. And this makes it a great asset if you’re looking for a secure real estate investment.

According to insights from Immobiliare.it, the proptech company affiliated with Immobiliare.it, the average monthly amount a person would need to allocate for rent – ideally not exceeding 30% of their net income – has been compared with the actual average rent demanded for a two-room apartment in major urban centers. In Florence, for instance, the average monthly rent for a two-room apartment stands at 1,066 euros, yet the average budget available for a single individual barely surpasses 480 euros. Shockingly, only 0.5% of the two-room apartments listed in the market are affordable for solo renters. Following closely is Naples, where the average monthly rent climbs to 850 euros, but given the municipality’s average income, a single person can only afford around 415 euros for rent, less than half of the required amount. Consequently, the accessibility rate falls below 1%.

Milan boasts the highest rental rates among the cities under scrutiny, with rents exceeding 1,320 euros per month for a two-room apartment, while the budget available to a single individual, at 650 euros, falls significantly short. A similar situation unfolds in Venice, where despite an average monthly rent of approximately 880 euros, a single person can only afford 430 euros, less than half of the required sum. Moreover, while in Milan only 0.8% of the two-room apartments on offer are within reach for solo renters, the situation in Venice is even direr, with no affordable options available. Single individuals face challenging rental conditions in Bari and Bologna as well. In Bari, where the rent for a two-room apartment has surged by nearly 200 euros per month over the past year, reaching 800 euros, the average salary fails to meet the required amount, hovering around 430 euros. Meanwhile, in Bologna, the average rent stands at about 925 euros per month, exceeding what a person could realistically pay by 510 euros. In Rome, there’s a glaring disparity between the rent demanded by landlords and the budget available to renters, with a gap of over 70%. Landlords request an average monthly rent of 890 euros, while the budget of a single individual barely reaches 520 euros. Verona fares slightly better, with an average monthly rent of 770 euros, aligning closer to the budget of around 480 euros that a resident can allocate for rent. In the two major Sicilian cities, Palermo and Catania, the gap between the rent demanded by landlords and the budget of single renters hovers around 45%. In both cities, the monthly rent slightly exceeds 580 euros, while renters can only afford around 400 euros. In municipalities like Turin and Genoa, where the available budget for renting a two-room apartment closely matches the rent demanded, there’s a more balanced situation. In Turin, the average monthly rent slightly exceeds 600 euros, whereas a single individual can afford around 500 euros. Similarly, in Genoa, the gap between the average monthly rent of 550 euros and the personal resources of 450 euros is narrower. Notably, Genoa remains the city with the highest accessibility to two-room apartments for single renters, with 38% of the available stock.

Antonio Intini, Chief Business Development Officer of Immobiliare.it, commented: “The analysis reveals that the rental market in our major cities offers few sustainable options for those with a single income. In most cases, single individuals must allocate at least 50% more than the considered sustainable budget for rent, if not double. Considering the potential for further rent hikes, it’s imperative to reflect on the future of our main urban centers, which are becoming increasingly inaccessible to new generations, forcing them to seek housing solutions in the outskirts and potentially weakening the socio-economic fabric of the cities.”

Source: Monitor Immobiliare

La Lombardia è la regione con più transazioni in Italia

Rents Yield Like Never Before. Since 1998, Real Estate in Milan Appreciated by +130% (source: Tecnocasa Group)

By Columbus International,27 February 2024

Real estate investments are experiencing a steady increase, driven by stable returns that demonstrate gradual yet consistent growth over the years. The appreciation of property values has become a widespread trend, with double and triple-digit increases occurring in almost all regions over the past 25 years.

According to an analysis conducted by the Research Office of the Tecnocasa Group, in the first half of 2023, 19.6% of real estate transactions were made for investment purposes. This figure represents a slight increase compared to the same period the previous year, when the percentage was around 16.8%. Rising inflation is prompting more and more people to invest in bricks and mortar, traditionally considered an excellent form of investment.

The return of tourists has also contributed to revitalizing the real estate market, with an increase in purchases of properties intended for accommodation in both popular cities and tourist destinations. The analysis primarily focuses on the long-term rental market rather than seasonal rentals. The prospect of earning steady rental income induces greater caution among property owners, especially considering the current economic uncertainty and rising energy costs. However, annual rental yields remain attractive, with an average rate of around 5.2% for two-bedroom apartments of 65 square meters in major Italian cities. Among the metropolises, Genoa, Palermo, and Verona stand out for the highest yields, at 6.6%, 6.4%, and 6.3%, respectively.

Real estate investors are not only aiming for rental income but also for the growth in property value over time. In recent years, there has been a recovery in property prices, with a preference for areas characterized by the presence of universities, services, and urban redevelopment projects. Fabiana Megliola, head of the Research Office at Tecnocasa, emphasized that real estate investors are interested not only in rental returns but also and above all in the appreciation of the property value over time. Between 1998 and 2023, major Italian cities saw an average price increase of 46%. Milan recorded the highest appreciation, with an increase of 132.1%, followed by Naples with 72.1% and Florence with 71.2%.

Source: Sole24Ore

Skyrocketing Demand: Luxury Real Estate Surges 9% as Global Buyers Flock In

By Columbus International,5 February 2024

The transactions of luxury homes are experiencing a 9% increase, with demand surpassing supply, according to the report from the Gabetti Studies Office based on data from Santandrea Luxury Houses & Top Properties, specializing in the analysis of the prestigious real estate market. Foreign buyers represent 70%, while the remaining 30% are Italians. In most cases, the purchase is motivated by exclusive use, either as a primary residence or a second home. The average age of buyers ranges from 45 to 70 years for properties costing at least one million euros, and their maintenance can be costly. High floors and terraces are the most requested features, followed by parking spaces.

Milan stands out as the most expensive city, with prices averaging a 1.4% increase in 2023 compared to the previous year. In the Brera district, the average price per square meter exceeds 11,000 euros, while in the Quadrilatero, it stands at around 12,300 euros. In Rome, demand is increasing in the Prati and Salario-Trieste neighborhoods, with average prices for new/restructured properties around 6,000 euros per square meter. In the historic center, the average price per square meter exceeds 10,000 euros.

In Florence, the most expensive areas are central, such as the Lungarni, where a new/restructured residence costs an average of 6,200 euros per square meter. Genoa records price increases everywhere except in the Quarto/Quinto area. In Naples, prices remain essentially stable, and the number of transactions is slightly decreasing. In Turin, prices also remain stable, although the demand for purchases varies depending on the neighborhoods.

Source: Corriere della Sera