MILAN-Italian real estate is considerably less attractive to international investors than it was a few years ago, said BNP Paribas Real Estate in a report. Investment volume in the first half of 2010 fell 13% from the previous half to around $2.5 billion due to economic uncertainty as well as to the characteristics of operators active in the market: pension funds, social security funds and private investors.

The two deals closed so far by international operators were also the biggest of the year and both concerned shopping center deals: Porta di Roma was bought by a joint venture between Allianz and Corio for $612 million; Le Vele in Cagliari hinterland bought by Corio for more than $140 million. The deals prove that shopping center investments in Italy are still interesting, despite the slowdown in Italian household consumption.

In contrast office investments have not even reached $1.4 billion in the first half of this year. Very few large office investments were made, the largest being the Lepetit 8/10 office building in Milan, which sold for $164 million but with a discount close to 20% with respect to 2007 purchase value.