CBRE Investment Management has acquired a build-to-rent multifamily asset currently under construction in the Cascina Merlata district in Milan, Italy. The developer selling the asset is Greenway S.r.l.
Once complete, the asset, which is classed as affordable housing, will comprise 170 apartments spread over ten above-ground floors, with two below-ground floors allocated for car parking. The ground floor and mezzanine level will be dedicated to storage and bike parking. Homes will range from studios to three-bedroom apartments, all with large terraces, and suitable for a range of occupiers, including young professionals, families and downsizers.
The asset is located along the main boulevard of Cascina Merlata - a new 900,000m² residential district. Already home to 3,000 people, development at Cascina Merlata is expected to complete in 2025, when its population will climb to circa 13,000. As well as residential buildings, Cascina Merlata will include public amenities, a shopping centre, and a 200,000m² public park.
The Cascina Merlata district is adjacent to Milan’s Expo Area, which is undergoing significant urban regeneration, and houses sporting facilities, an open-air theatre, a university campus, and a hospital. Cascina Merlata also offers residents excellent transport links: the city centre can be easily reached via Via Gallarate and Viale Certosa, and the asset is within walking distance of the Molino Dorino metro station.
100% of the building’s GLA is classified as affordable housing by the Milan municipality and as a result, the rent is circa 30% lower than the open market rent, making this a highly defensive investment asset with strong reversionary potential over the long term.
Alberico Radice Fossati, Head of Transactions Italy at CBRE Investment Management, said: “Milan is home to one of the highest numbers of homeowners in the EU, but in recent years, there has been a shift to renting due to the high prices of homes, as well as people looking for flexibility in where they live. We have also seen the appetite in Milan increase for multifamily properties offering hospitality-style amenities - reception areas, carsharing, in-house gyms, and so on. This was an exciting opportunity to purchase a residential rental asset that meets these criteria while offering an affordable solution for living within a city that is already reaping the rewards of various regeneration projects.”