Fashion to turn on real estate

Commercial real estate has started to run again and is already looking to the post-pandemic period. Fashion and luxury play a fundamental role, with Milan remaining the undisputed protagonist: «The excitement involves not only the Quadrilatero della moda and its surroundings, but also the Cordusio, Vittorio Emanuele, San Babila and Buenos Aires areas, as well as Porta Nuova», the experts interviewed by MFF confirmed.

In the rest of Italy, Florence and Rome have begun to move, along with Venice, awaiting the return of tourists. Other potential cities are Bologna, Turin and Naples. Via Montenapoleone in Milan continues to be the most expensive area, with rents ranging between 12,000 and 15,000 euros per square meter per year, which tend to rise, followed by Via dei Condotti in Rome with 8-10,000 euros. Foreign investors are returning, albeit with caution, to look at trophy assets, especially in the Lombardy capital. «The enthusiasm is real. Of course, brands are carefully evaluating the contracts and asking the landlords for more flexibility in the free rent, an increasing fee over a period of 3-4 years and possible benefits for renovations, retrieving pre-Covid values. Large companies, but also small ones, are starting to move and we will see the materialization of this especially between the end of 2022 and early 2023», Thomas Casolo, international partner head of retail Italy at Cushman&Wakefield, explained.

Milan, whose top locations’ fees have stood, is already giving an important taste of novelty. In Montenapoleone, we are waiting for the restyling of number 2 in the hands of Lvmh group, which will use former Garage Traversi in Via Bagutta as a temporary location. A fresh look for Gucci, which will open a temporary store in Via Verri, Bigli Corner, is also on the way and changes are foreseeable at number 8 as well (occupied by the Cova coffee shop and by Lvmh brands, Kering and Prada), the jewel in the crown of the real estate assets of Reale compagnia italiana, acquired by Blackstone.

«Via Montenapoleone is in great turmoil and increasingly the prerogative of luxury groups and their brands. Fees are not the real problem, the lack of space is: brands are willing to do crazy things to have a place on this street», Maristella Brambilla, partner of 18 Montenapoleone retail consultancy & brokerage, confirmed. «Still in the Quadrilatero, Via della Spiga is in strong recovery, after the arrival of Ralph Lauren and thanks to Hines’ mega project, Spiga 26, which will host the monobrand stores of Moschino and Sergio Rossi, as well as Kering’s Milan headquarter: here a garden restaurant will probably also open and we are negotiating to complete the retail offer», Brambilla added.

Ferragamo's project continues along with it in the former archiepiscopal seminary in Corso Venezia 11, starting with the Portrait Milano hotel. «Fashion and luxury are the large part of high street retail, as always, and, now in particular, streetwear and new luxury brands are the protagonists, entering our market through pop-up and temporary stores to test the brick-and-mortar formula», Niccolò Suardi, head of high street retail Italy at Colliers international, stated. «In Milan, the place to be, the rapid growth of the Cordusio area should be highlighted, in addition to the traditional top locations, thanks also to the projects between Via Mercanti and Via Santa Margherita up to Via Manzoni. The Porta Nuova area will see an important redefining of the offer. The area of Piazza San Babila should be monitored, as the core of the pedestrianization project that includes the opening of the M4 line», Suardi explained.

In the Duomo area, besides the continuous interest in Galleria Vittorio Emanuele, the Odeon cinema will become an experiential hub by 2024, with a retail space of 5,000 square meters. In the Cordusio area, within the Mercanti 22 project, the End clothing retailer, owned by Carlyle (see MFF of January 28), will be opened. The opening of the second Uniqlo store will be among the novelties of the Porta Nuova area.

«In order to understand the market, the regenerating interventions of properties by creating more suitable and user-adjustable spaces are key, such as the restyling of Hines in Via della Spiga, the Ba59 project in Corso Buenos Aires with Nike and the Palazzo di Fuoco in Piazzale Loreto that will host Airness. Or the upcoming Odeon. Within these new projects, it is also possible to obtain more interesting entrance benefits», Gianluca Sinisi, license partner at Engel&Völkers Milano commercial, explained.

«Milan is undoubtedly the most active market. As for the rest of Italy, Florence is starting to recover followed by Rome, while Venice is waiting for tourists to return, as they are currently less than half of the usual 26 millions», Rodolfo Rustioni, ceo of Rustioni&Partners, stated.

«Like fashion, retail never runs out, but continues to change according to buying habits. It is a moment full of novelties and important strategic choices by brands, especially in luxury, a trend accelerating for the next three years», Monica Cannalire, founder of Younicorn, stated, giving a message of undisputed optimism. (All rights reserved)