Property: the Bicameral Commission identifies the key issues in the management of INPS and INAIL

An inquiry that began in mid-October last year and concluded in early June. Objective: to examine in depth the investment and development policies relating to the vast property portfolio of INPS and INAIL. The inquiry was led by the bicameral supervisory committee for social security bodies, chaired by the economist Alberto Bagnai (Lega).

We have had the opportunity to read the final draft (dated 9 June), which summarises the numerous hearings held by the Bicameral Committee on this subject. In particular, there is a focus on the critical issues regarding the properties of the two bodies; it is noted that ‘reducing the number of unused properties and increasing profitability are now among the main management challenges facing public pension fund property assets’. The Commission highlights the issue of vacancy (unoccupied properties, ed.). The supervisory body also considers it ‘necessary for the institutions to adopt integrated medium- to long-term asset strategies, based on measurable objectives and a clear distinction between operational assets, income-generating assets and properties with a potential social function’.

With regard to INPS, the document specifies that at the end of 2024 the total gross value of the real estate assets managed directly and indirectly amounted to approximately €4.65 billion, whilst the net book value stood at approximately €3.53 billion. ‘The documentation provided,’ the draft states, ‘does not, however, include an overall estimate of the presumed market value of the Institute’s entire real estate portfolio, a circumstance that may affect the transparency of information, the inter-institutional comparability of data and the full economic and financial valuation of the assets held.’

With regard to ‘structural issues’, the report highlights ‘the high vacancy rate, amounting to 12,811 vacant properties as at 31 December 2024, corresponding to approximately 55% of the total, the presence of squatters or unauthorised occupants, the high proportion of properties arising from the Scip I and Scip II transactions (the securitisations of early 2000, ed.), significant tax and maintenance costs, and profitability that remains modest relative to the size of the portfolio held’. From 2022 to 2024, INPS’s net operating return ‘increased from 0.52% to 1.12%. However, a negative net financial income of approximately €2.6 million persists, partly due to tax, maintenance and management costs’.

‘In the case of INAIL,’ it is noted, ‘the real estate portfolio has different characteristics, which are more consistent with the organisation’s insurance function and with the coverage of technical reserves.’ At the end of 2024, “the total value of the portfolio amounts to approximately €4.47 billion, compared with an estimated market value of approximately €4.73 billion. The composition of the portfolio is predominantly focused on properties intended for public tenants and for purposes of general interest, ensuring greater stability of rental income and lower exposure to the risk of insolvency.” On the critical issues front, the following are highlighted: “SCIP transactions, unused properties or those undergoing development, the timeframes for the completion of development investments, and the growing impact of redevelopment costs”.