Mixed-Use Asset in Milan Sells for $65.1M
- Mar 24, 2016
“It has a strong location. It is not easy to find prominent properties on European ‘high streets,” Mario Abbadessa, Hines’ Italy country head, told Commercial Property Executive. “Also, the opportunity to get a value enhancement through expansion of the retail area coupled with an optimization of the lease contracts makes this an attractive deal.”
The seven-story, 19th century building is located just south of the Castello Sforzesco in the core of the city of Milan.
“We think this ‘critical mass’ location is strong,” Abbadessa said. “Piazza Cordusio, the Duomo and the Castello Sforzesco are all within a five-minute walk. Pedestrian foot traffic is extremely high (almost 15 million people per year). In addition, the street is already home to major brands such as OVS, Celio, Triumph, Desigual, etc.”
The property is nearly 100 percent leased and the new owners are reportedly planning to redevelop the space to create a flagship high-street store with office space at the higher floors.
“We are seeing a strong interest in the Italian market mainly in the top cities driven by tourism, like Milan, Rome, Florence, Venice and Boulogne, particularly where assets can be repositioned to generate middle/large size retail storefronts,” Abbadessa said. “We are planning to optimize the existing retail space on the first floor and possibly reposition leases and tenants on some of the upper floors.”
Since entering Italy in 1999, Hines has developed 20 projects, including the landmark mixed-use development Porta Nuova in Milan, which includes 1.5 million square feet of office, 1.3 million square feet of residential and 430,000 square feet of retail and cultural venues.
“Italy has long been and continues to be a strategic market for Hines,” Michael Topham, Hines Europe CEO, said in a prepared release. “The closing of this transaction helps to further strengthen our retail and expand our geographical reach across Italy.”
The acquisition marks the second by BVK with Hines’ assistance, following the purchase of an iconic building on Oslo’s Karl Johans gate in December.