Add Capital GP makes its first investment in Milan, but outside the ‘Piano Casa’ scheme

Add Capital Gp – the limited liability company led by Mario Abbadessa – is reportedly set to finalise its first transaction. The Luxembourg-based limited liability company is in fact in exclusive negotiations to acquire the student accommodation at Via Ripamonti 35/37, in Milan, through Add Value Fund 1, the fund dedicated to market transactions in Italia and Europe. According to reports, the property would not form part of the company’s activities linked to the ‘Piano Casa’ housing scheme, but would instead be part of a broader strategy pursued by Abbadessa’s new venture. The latter is said to have submitted the most competitive bid in a tender process involving several institutional investors.

The property was acquired in 2018 by a joint venture between Hines Italy and Blue Noble, an international property investment manager, for a total investment of around 75 million euros: €25 million was allocated to the purchase of the site from a fund managed by Prelios Sgr, and a further €50 million to the redevelopment works. The property is situated on the site of the former Consorzio Agrario di Milano, a historic complex that was once a landmark for the agricultural sector and has now become the focus of a major urban regeneration project.

The student accommodation is now managed by aparto, the international student accommodation platform wholly owned by Hines. Situated a short distance from Bocconi University, the campus covers an area of approximately 30,000 square metres and offers over 700 beds, as well as numerous communal facilities, including study rooms, recreational spaces, a cinema, fitness areas and a basketball court. Following its redevelopment and repositioning, the asset is now reportedly valued at between 110 and 150 million euros. Part of the facility is dedicated to social housing: of the 717 beds, 268 are allocated to students at the University of Milan at a rent of 250 euros per month for a double room, payable for 11 months. According to rumours, following the acquisition, Aparto will remain the operator for a maximum of a further nine months. After that, the search for a new partner will likely begin.

The student accommodation on Via Ripamonti is reportedly just one of Add Capital’s initiatives to launch a series of deals aimed at raising capital. At the same time, the company is working on the ‘Piano Casa’: Add’s financiers are reportedly the Abu Dhabi sovereign wealth fund Mubadala, the main investor with over 600 million, alongside CDP (425 million) and other private investors. However, a number of issues still need to be resolved for the full implementation of the Housing Plan. The main one is the requirement for 70 per cent of housing to be social housing at controlled prices, combined with 30 per cent at free-market prices – a requirement that could make the business plans for several projects unsustainable.