Without 'Save Milan', 38 billion in investments at risk

The substantial freeze on new initiatives in Milan is already having an effect on many ongoing and planned urban regeneration initiatives; According to Scenari Immobiliari, the investment potential was estimated at over 12 billion euro for the residential sector alone by 2035 (19.5 billion euro considering all other asset classes as well), to which must be added another 26 billion euro as spin-offs on Milan's economic system (from furniture to services), without considering the consequences for employment in the construction sector, and receipts for the municipality - estimated as charges and contributions - of between 60 and 80 million euro per year. These are some of the figures emerging from the second observatory on housing - The winning cities: market and neighbourhoods for the residential demand of families, produced by Scenari Immobiliari and Abitare Co. and presented this morning in Milan during the Housing Forum.

The so-called 'save Milan' regulation was expected within the 'save home' decree that the Council of Ministers should approve on Friday. Instead, it will be included in the measure that will be converted into law, so it will inevitably follow a longer parliamentary procedure. The rule will have to clarify the fate of a number of buildings in the city, at the centre of investigations by the public prosecutor's office for building abuses, built on the basis of an 'Scia' and treated by Milan's urban planning offices as 'demolitions and reconstructions'. For the public prosecutor's office, however, this is a misinterpretation and believes that in these cases a proper building permit with a service plan must be issued. The Municipality of Milan has always defended its interpretation of the rule, but the multiplication of investigations has highlighted the need for clarification from the legislator.

"These risky investments," explains Francesca Zirnstein, general manager of Scenari Immobiliari, "are also impacting on the expectations of international investors who have bought around €40 billion in Milan over the last ten years; now they are more cautious about new and are starting to look at investments outside the city or elsewhere. And let's not forget that the shortage of supply on the residential market leads to a further rise in the prices of existing properties".

"Milan and its hinterland are consolidating their role as an attractor of the new residential construction market despite the administrative uncertainty that is clearly affecting and slowing down, or even halting, the city's major real estate developments since the second half of 2023," said Giuseppe Crupi, CEO of Abitare Co. We are seeing that today some operators are no longer investing in Milan or, at best, we are recording a progressive recourse to more cautious approaches by developers, with a further limitation of the future housing supply in the short and medium term, against a demand that, fortunately, remains lively. A demand for new homes, not only high-end, that particularly appreciates investment issues related to energy consumption, environmental impact and common services dedicated to people".