Luxury Real Estate in Italy: A huge surge in demand for 5 Star assets expected
Date: October 6, 2021
- According to Berkshire Hathaway HomeServices, investments in 5-star hotels are expected to increase by 25% over the next three years
- Marcus Benussi: “Today’s demand is not completely satisfied. Accommodation owners must consider the essential investments to achieve a multiplied value”.
In the world of Luxury Real Estate, Italy is a key market, always under the lens of foreign investors. This is the finding of the Global Luxury Landscape report 2021 by Berkshire Hathaway HomeServices – an international brokerage network operating in Italy through the partnership with Maggi Properties – which underlines how the pandemic has emphasized the attention towards Italy. High expressions of interest from abroad highlight the interest, even for more peripheral areas such as the Colli Piacentini and the lakes area (Como, Garda and Maggiore). This growth does not only involve the residential sector, but also the entire Italian hospitality system, which is increasingly becoming “the place to be”, even in a phase of the decreasing pandemic.
To maximize this value, it is necessary to efficiently connect supply and demand. With a strong experience in brokerage and property finding businesses, Berkshire Hathaway HomeServices Italy enhances its expertise in the hospitality sector through the partnership with Horwath HTL, Italy – a world leader in hospitality consulting. This collaboration aims to meet the needs of investors in the hospitality industry.
The context is challenging: the proposal of accommodation facilities leverages Italy’s tourism and landscape potential to attract international customers, who are too often disappointed by structural problems making it difficult to close deals. Some elements of the gap: slow and complex bureaucracy, fragmented ownership among different partners/family members, expectations of services and connections with the main tourist centres, new financial and development models. This context creates a distance from the requests of investors who complain about lengthy negotiations, improvised mediators unable to guide them through the architectural constraints of the urban plan and a bureaucracy with no certain timeframe.
Marcus Benussi, Managing Partner & General Counsel, Berkshire Hathaway HomeServices – MAGGI Properties commented: “Our network receives property finding mandates that are sometimes impacted by the gap between the expectations of foreign investors and a lack of understanding of international luxury standards. The interest towards Italy is always very strong and growing, but we need a player able to guide sellers to a successful international deal – and Berkshire Hathaway HomeServices does this”.
Tourism in Italy today is worth more than 10% of its GDP and this also drives real estate investments. In this context, international operators guarantee a worldwide showcase for the properties, sometimes hidden, of the Italian territory. More than 10% of hotels managed by chains in Italy operate in the 5/5L star segment and it is no coincidence that 50% belong to foreign groups (Horwath HTL 2020 data).
“Historically in our country, hotel product is concentrated on 3-star facilities, which represent more than 46% of the almost 33 thousand properties in the territory” added Zoran Bacic Senior Partner & Managing Director of Horwath HTL, Italy.
“In this scenario, luxury hotels, with 5-star and 5-star L, will grow by at least 25%, in strong countertrend to the entire sector. And yet, their weight on the total number of accommodation facilities remains below 2%. The demand for luxury tourism is destined to grow, so we must be able to seize this fervent desire for investment coming from abroad. Owners must evaluate the necessary investments to finally obtain a multiplied value”, concluded Marcus Benussi.
Maggi Properties
Maggi Properties is the result of more than 40 years of experience in the management of real estate transactions in the main segments of the real estate sector: residential, commercial, industrial, office and tourism. Founded in 1981 by Cesare Maggi, the structure involves the synergic use of the Advisory and Retail divisions. Activities are extended throughout the country thanks to a network of highly qualified professionals.
Berkshire Hathaway HomeServices
Berkshire Hathaway HomeServices is one of the most̀ authoritative, selective and fastest-growing real estate networks with nearly 50,000 agents in over 1,400 offices. Founded in late 2013, in just over 5 years it has achieved significant milestones and brought together the best real estate professionals in the world. The goal is to be present in all strategic areas of the planet, uniting Europe, Asia and America in a global brand. Berkshire Hathaway HomeServices is part of Warren Buffett’s Berkshire Hathaway Inc. holding company, one of the world’s most renowned companies with more than $200 billion in assets and 60 companies, including HomeServices of America, the parent of Berkshire Hathaway HomeServices. The holding company also holds significant shares in companies such as American Express, Wells Fargo, Coca-Cola and IBM.
Horwath HTL
Horwath HTL is a member of Crowe Global, a professional association of accounting and management consulting firms founded in New York in 1915 with over 200 firms in 130 countries.
Horwath HTL (Hotel, Tourism and Leisure) is one of the leading specialist consultancy groups in the Hotel, Tourism and Leisure sector, offering experience and expertise for client projects around the world through a combination of local knowledge and international ‘vision’. Horwath HTL is currently the world’s largest specialist hospitality consultancy organization, with 50 offices in 40 countries.
[1] Research in collaboration with Mansion Global Custom Studios
