from Milan to Rome, the examples of «Build-to-rent» – Corriere.it

Building to rent. The ‘new’ concept of real estate development “Build to rent” is also making headway in Europe and Italy. In our country in 2022 BTR investments reached 850 million euros (Cbre data). In fact, it is an innovative approach to the use of real estate assets: builders and planners do not build (or renovate) the complexes of houses and apartments for sale but with the aim of renting immediately. And they organize the sizes to have a large number of housing units to rent. Those who invest in it continue to have profits over time thanks to the payment of a single rent by the asset manager. For example, in the case of a newly built condominium purchased en bloc by institutional investors, the rents will be managed by a single entity. The advantage then lies in the core yields which are around 4% (Cbre data).

The difficulties

In Italy, however, despite the rapid growth of the phenomenon, especially the lack of real estate suitable for the Btr. In fact, there are few independent ones and very often they are old buildings to be restored. The result is an almost elitist niche market if you look at the costs. In fact, on the consumer side, the BTR is of interest today to citizens with high-end incomes, also because together with the apartment for rent, the tenants are guaranteed attractive services of excellence: gym, coworking, recreational spaces. The idea is to create a sort of community in the residential complex and avoid vacancy as much as possible.

Where to invest: Milan and Rome

The new trend affects the big cities with Milan in the lead for Italy. In the Milanese city, for example, Barings Real Estate, a global manager of diversified real estate investments, recently purchased a residential complex in the Bovisa district on behalf of the Barings Real Estate European Value-Add Fund II. The asset will be refurbished and more apartments will be created. As did G Rent Spa, which operates under the Gabetti Short Rent brand with the “Build to rent” business line. The company has signed an agreement with Immobiliare Stilicone 15 Srl for the management of a complex in the Monumental Cemetery area. To get an idea of ​​the prices if you book a two-room apartment of 69 m2 internally and 60 m2 of terrace on the site today, you will spend over 4,500 euros for a month. Which rises to 4700 with cleaning included.

Experiments also in Rome. Here in via Niccodemi 21, a complex of 225 residential units is under construction following the investment in a joint venture between Incus Capital, an investment company based in Madrid, and IGS. Vincenzo Zubbo, Head of Business Development of Colliers Italia who acted as advisor says: Residential has proven to be resilient as an asset class after the pandemic and is now opening the door to quite new phenomena for Italy, such as Build To Rent. A winning choice, as long as there are areas able to offer high quality and, at the same time, a capital value adequate for investors’ remuneration. It was precisely in Rome that we saw the ideal conditions for transforming this opportunity into a win-win solution for all the players involved in the operation. We supported each of them as an advisor and in the end we managed to bring a fund to international capitals to lead the way for the BTR of the Capital “.