'Colossal opportunities exist for the development of shopping centres in southern Italy,' according to Pietro Malaspina, CEO of Sierra Development Italy. Malaspina was speaking at a conference held last Thursday at the fourth annual edition of Expo Italia Real Estate, the trade fair focused on real estate in Italy and the Mediterranean basin. Malaspina said southern Italy is also less risky than the markets of the east. 'Despite the subprime crisis, Italy is still a healthy market, especially as far as retail is concerned.'
'Colossal opportunities exist for the development of shopping centres in southern Italy,' according to Pietro Malaspina, CEO of Sierra Development Italy. Malaspina was speaking at a conference held last Thursday at the fourth annual edition of Expo Italia Real Estate, the trade fair focused on real estate in Italy and the Mediterranean basin. Malaspina said southern Italy is also less risky than the markets of the east. 'Despite the subprime crisis, Italy is still a healthy market, especially as far as retail is concerned.'
Fabio Bandirali, general manager of the Italian arm of Eurohypo noted the German real estate bank had not been interested in southern Italy in 2000 but now saw it as an opportunity. Corrado Vismara, CEO of Larry Smith Italia, noted that Italy’s southern regions are moving to close the gap with the wealthier north when it comes to the quality of shopping centre projects.
Among recent ones in southern Italy which he cited for their high quality were the Mongolfiera shopping centre project inaugurated earlier this year by the Italian arm of Dutch commercial property investor Foruminvest in Molfetta, Apulia as well as the Vesuvius-inspired Vulcano Buono shopping centre in Nola, near Naples, designed by famed Italian architect Renzo Piano. Gallerie Commerciali Italia - a joint venture between the international real estate arm of French retailer Auchan and Simon Property - and Interporto Campane developed that project, while the region of Campania also provided financing.
While conference participants agreed that shopping centre development opportunities in southern Italy remain strong, many also cited obstacles to projects. Among these is the long time span typically required for completing them. 'The time to market can even exceed 10 years, which is unacceptable,' said Fabio Porecca, CEO of Italian retail property consultancy Sviluppo Commerciale. 'The approach of the public administration can also be to limit the size of projects.' He explained, for example, that many shopping centres in Apulia were mid-sized while developers are often interested in larger projects. Some shopping centres may be located in municipalities that are opposed to keeping stores open for business on Sunday, an increasingly important shopping day in Italy.
At the same time, Porecca and others stressed that southern Italy is a heterogeneous market. Roberto Marchetti, general manager of Italian developer Mall System noted that its recent expansion of the Due Mari centre in Calabria had been warmly received by the local government.
Ermanno Niccoli, CEO of Corio Italia, said the Dutch retail specialist considers itself as a long-term investor in the market. Its Centro Commerciale Campania in Marcianise is Italy’s biggest shopping centre and the second most important property in Corio's portfolio, with a net asset value of about EUR 312mln.