Milan EXPO 2015 Boosts City's Rental Market by 10%
Milan is currently hosting the annual international EXPO event which kicked off on May 1st, showing until October 31st and has already seen positive benefits in local property markets. The impact has been significant, particularly with home prices still discounted by up to 30% on pre-crisis levels according to realtors based in the fashionable Italian city.
Diego Meani, sales manager Milan Sotheby's International Realty remarked on the EXPO's impact locally: "We have already seen a 10% increase in rental enquiries since the start of EXPO 2015 and this positive impact on the market will continue throughout the event. There is also a positive outlook for how the EXPO will affect the sales market and we are expecting high levels of interest from foreign buyers from Switzerland, Belgium, America and the UK in particular throughout the event."
"These buyers are attracted to the much loved Italian lifestyle along with the bargain property prices still available from the recession. Currently, prices are roughly €10,000-15,000/sqm for apartments in the centre of Milan and are 20-30% less in surrounding areas such as Rho."
During EXPO Milano, the city will be a global showcase where more than 140 participating countries will show the best of their developments in technology providing solutions to vital issues such as famine and poverty. The event is set to welcome up to 25 million visitors to the 1.1 million sqm of exhibition space.
As property prices have declined in Milan in recent years, investor interest has grown particularly from Britain, Belgium and America. Now, these savvy buyers are renting their properties out on short-term contracts during EXPO and are set to receive a yield of 50% more than they would ordinarily, according to Sotheby's.
Increased buying activity from foreign investors in Milan is underpinned by the huge investment that has poured into the EXPO site, with significant improvements in urban infrastructure in neighbouring towns contributing to rising demand for homes.
Milan has been attracting buyer interest from large-scale international investors, particularly drawn to high value opportunities in the commercial sector. Swiss global asset managers Partners Group acquired two central Milan office properties for clients, paying €233m in the deal earlier this year.
The firm with more than €33bn in assets under management said the two office blocks – one in Via Monte Rosa and the other in Viale Sarca – provided "high-quality cash flows and feature long-term lease contracts with excellent tenants". Partners said it bought the assets at an entry price which would enable it to realise "significant value" in a market with "constantly improving fundamentals".
