ING REIM gets go-ahead for Italian fund management arm

ING Real Estate Investment Management has received the green light from the Bank of Italy for the creation of an Sgr real estate fund management unit. The move is part of the Dutch investment management giant's plan to boost its presence in the Italian property market, country manager Lisette van Doorn told PropertyEU.

'We have been active in Italy since 2005, investing through a number of Dutch domiciled funds. By now, we know the market well enough to be able to raise capital locally from domestic institutional investors,' Van Doorn said. The new SGR entity will be the first fund manager in Italy to focus on shopping centres, she added.

ING REIM currently manages around EUR 1.2 bn of assets in Italy with 24 staff in Milan. Shopping centres account for the bulk of its portfolio, representing EUR 1 bn of assets, with the remainder consisting of offices and logistics. The company invests in the country on behalf of both international clients and the ING Retail Property Partnership Southern Europe, which has EUR 500 mln of assets in Italy, and the EUR 300 mln ING Real Estate Italian Retail fund.

Van Doorn, who has been leading the Italian business of ING REIM since late 2009, says the creation of an Sgr vehicle has long been on the group's agenda. 'We already prepared the launch of such an entity at the end of 2009. However, the plan was postponed following the introduction of new rules regarding the real estate fund management industry,' she explained.

The new fund management arm will focus on institutional clients, taking account of the fact that the Italian investor market differs a lot from other big investment markets in Europe. 'Contrary to other European countries, the Italian state pension funds and the large insurers have so far not invested much in the retail property sector, apart from high street, and we will take this into account when adapting our business to the local market,' Van Doorn said.

However, she added, the company will also endeavour to bring a change in the investment criteria of the main institutional investors. Van Doorn: 'Italian shopping centres represent an attractive investment for institutional investors, particularly at this point in time when we are slowly seeing more investment product of institutional quality coming to the market.'

Commenting on the Italian property market, Van Doorn said that ING REIM is positive about future prospects but added that stumbling blocks remain for international companies active in the country. 'The main risk I see is a regulatory one. So far, we have modified our business plan three times because of legislative changes. We have now decided to wait and see what the law will look like when we are ready to go and prepare ourselves in the meantime.'