Italy’s Parsitalia seeks international partners

Italian developer Parsitalia Real Estate is seeking to expand its activities beyond its traditional stronghold in the centre of the country.

Speaking to PropertyEU in an interview, managing director Marco Miano said the company is eyeing growth on a nationwide basis through partnerships with local and international capital sources.

‘We have identified three areas where we would like to expand our business, namely the city of Milan, secondary shopping centres in Northern Italy as well as luxury hospitality,’ he noted.

This transformation of the business follows the company’s efforts in the past few years to shift its activities towards commercial real estate from housing, he added. Currently, Parsitalia’s portfolio consists of roughly 66% commercial real estate and 33% residential property.

‘We are already looking at some operations in the city of Milan for instance. There are good opportunities to create partnerships, particularly with international players which have not been active in the Italian market before. We are looking for projects with a low level of risk where we could play a role as property and development manager or as general contractor,’ Miano noted.

The move reflects major changes in the development market which has been constrained by a lack of finance, forcing developers to either team up with third parties or finance projects entirely with their own capital.

Miano: ‘The property sector is suffering and needs not only re-pricing but new liquidity. The market also needs a high level of supply in order to attract institutional investors.’

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Rome-based Parsitalia is behind some of the capital’s largest development projects. In the Eur district, the developer has erected the city’s first residential tower as part of a major mixed-use projectf called Europarco.

The site currently consists of the 56,500 m2 Euroma2 shopping centre, which was sold to Groupe Générale Immobilière (LSGI), owned by French-Hungarian businessman Robert de Balcany; the Eurosky residential skyscraper as well as a majority of the planned 166,000 m2 of offices, which have attracted companies including the provincial Rome authority and the Atac local transport company.

‘We have recently reached an agreement with two primary tenants for the realisation of a further two buildings offering another 60,000 m2 of space,’ Miano said.

He added that the company hopes to be able to replicate the mixed-use concept of Europarco at its new development project in Tor Di Valle, where it plans to build the new stadium for the Roman football club. In the Tiburtina area, the company has been appointed to develop the new headquarters of bank BNL, offering a total of 40,000 m2.

However, Parsitalia's largest plans to date involve the construction of two major shopping centres in the Italian capital. Laurentino, located on the capital's ring road, is already under way and will provide a total of 62,000 m2 of gross lettable area over 135 shops on completion at end-2014. The total investment cost is estimated at around €140 mln.

The Laurentino mall has been at the planning stage for years. In 2007, it was sold to investors Degi and Irish Life Insurance for an estimated price of €357 mln. However, the deal was ultimately aborted and delivery of the scheme, which was first scheduled for 2010, was postponed.

The three-level scheme will include a hypermarket, a multiplex and a fitness centre, as well as 16 bars and restaurants and 3,000 parking spaces. The mall is targeting a Very Good rating under BREEAM environmental standards. The marketing of the asset has been entrusted to Cushman & Wakefield and the scheme is 70% pre-let at present.

In the Pescaccio area of Rome, Parsitalia plans to create a 115,000 m2 shopping centre with an adjoining retail park offering 40,000 m2. The site will reportedly also house a new Ikea hyperstore, which will become the third in Rome. The company is currently looking for an investor for the retail park after negotiations fell through with a foreign investor believed to be Dutch retail specialist Corio.

Parsitalia has completed a number of shopping centre projects in the past years including Porta di Roma, the capital’s largest mall, and the Tor Vergata shopping mall.