Overview
COIMA is a specialist in the investment, development and management of Italian real estate assets focused on delivering an ESG impact. COIMA Holding controls a range of operating companies including COIMA SGR, an investment and asset management firm which manages more than 30 real estate investment funds with over than €10bn in investments; COIMA REM, a development and property management company which has dedicated 50 years developing and managing properties which now spans a total of over 5m sqm; and COIMA HT which aims to enable the digitalisation of physical spaces.
Investment Principles & Strategy
COIMA’s investment strategy targets long-term value creation and ESG impact, leveraging on fundamentals and its vertically integrated platform, to optimise performance on a risk-adjusted basis.
The following key elements are analysed in detail:
- Economic and real estate cycle: relative value of real estate compared to past performance and forecast of future macro trends
- Micro locations: identification of prime and upcoming locations and detailed mapping
- Demand needs: end users’ requirements and how they are expected to evolve
- Demand / supply gaps: identification of market gaps creating investment opportunities
- Product: definition of product to be delivered in line with demand needs
- Sustainability improvement: with the goals to 2030 of having 100% of the portfolio aligned to 2° EU decarbonization pathway and all new developments LEED and WELL certified
COIMA’s vertically integrated structure, including inhouse asset, development and property management divisions, allows for a better identification, measurement and management of risks across the value chain.
Sector Forecasts
INDUSTRIAL:
Retail e-commerce has become well-established, and consumers increasingly prefer this method of shopping, reinforcing the need for domestic and international companies to have warehouses in Italy over the long term. The demand for logistics assets reflects trends across the entire real estate market, particularly for grade-A assets emphasizing sustainability and quality. COIMA is focusing on both core and development-to-core strategies aimed at meeting international grade-A and sustainability standards, ensuring strong resilience for pursued investments.
COIMA believes the Italian market presents an attractive opportunity compared to peer European markets, with solid fundamentals driven by demand-supply imbalance, strong logistics rental growth, and vacancy rates at historic lows.
OFFICE:
Demand has continued to polarise towards Grade A sustainable properties in central and well-connected locations, with tenants willing to consolidate in smaller premises and pay higher rent per sqm.
Given the low availability of modern stock in Milan and Rome (the lowest among European peer cities), Grade A vacancy has reached record lows and prime rents have increased (+20% in the last 5 years).
COIMA believes the demand polarization trend to continue driving prime rental growth which will ultimately result into capital values recovery. Given this and the recent substantial correction driven by increased interest rates and lack of liquidity, COIMA believes 2024/25 to be an attractive vintage to enter the market with a brown to green strategy focused on prime locations in Milan and Rome.
RESIDENTIAL:
Residential demand in Italy has proved to be resilient with transactions above historical averages and prices on an increasing trend. Milan has seen the highest growth with the city attracting not only Italians moving from other cities but also professionals and HNWIs from abroad, driven also by tax incentives. Despite the growth, residential prices have maintained a sustainable level compared to peer European cities, given the low level of mortgages in Italy.
Demand is especially focused on new and modern stock, which is lacking in the market, driving pre-sales levels in Milan and Rome to record highs. Demand for rented apartments in large cities is also growing, but the stock is mostly owned by private individuals. COIMA believes these are structural demand trends which will continue over the long term.
COIMA believes 2024/25 is an attractive vintage for investments in development or repurposing to residential both for sale and for rent, given the outlined demand fundamentals, the attractive entry price driven by lack of liquidity, and the sustainable residential prices level.
RETAIL:
Retailers are concentrating on prime high street locations with strong tourism appeal and top-tier shopping centers to strengthen their presence in key regional markets. Milan retail market confirmed the trend with the Montenapoleone acquisition by Kering, registering one of the most expensive transactions ever in the Italian market and worldwide.
Although retail investment volumes have significantly decreased compared to previous years, high street properties and sale-and-leaseback transactions are sustaining annual transaction levels. A positive trend in the real estate sector is driven by omnichannel strategies, underscoring the essential role of prime physical stores as a complement to online sales.
COIMA believes the demand polarization trend for prime high street locations will continue in 2024/25, consolidating retail prime capital values in the Italian market.
HOSPITALITY:
Tourist arrivals in Italy since the end of the pandemic have spiked and ADR growth of the key Italian touristic cities has been higher than those of other European peers. The growth has been especially strong in the luxury segment where the offering in Italy is limited due to low penetration from international chains and generally obsolete stock. Given the high potential of tourism in Italy and the current status of the offering, COIMA believes there is an extremely attractive investment opportunity to fill the gap.
Strategic Corporate Development
Building and urban regeneration, ESG impact and digitalization are the key pillars of COIMA’s strategy. In the next few years, the group will operate according to an integrated model based on industrial and financial skills, enhanced by data automation and digitalisation, with an ESG impact approach across the entire value creation chain and across the integration of investment management processes and operations, attributing a key role to its people, sustainability, technology and innovation.
COIMA SGR, in application of the European regulation 2019/2088 (SFDR), decided to adopt the ‘comply’ approach when considering the negative effects of its investment decisions on ESG sustainability factors; as per today over 35% of portfolio value is disclosed under art. 8 SFDR and will achieve 100% by 2030.
COIMA’s ESG objectives for the next few years follow the decarbonisation guidelines of the EU. 100% of the group’s new developments will be aligned with the 2050 decarbonisation target of 2°C adopting both LEED® and WELL® certification.
The investment forecast in urban regeneration projects is up to €10bn over the next five years. 78% of COIMA’s portfolio is made up of assets in prime locations.
Among the main projects under way, the group is active in Milan both in the Porta Romana and Valtellina/Farini railway yard, and in the Porta Nuova district.
Performance Verification
COIMA’s investment strategy has integrated sustainable investment objective and is focused on creating a high-quality real estate portfolio, offering sustainable long-term returns. COIMA ESG Metrics is the company’s sustainability performance and risk analysis tool, which aims to generate, measure, monitor and provide sustainable, economic and social performance through key indicators based upon ESG parameters.
COMPLIANCE STATEMENT
In compliance with the Italian regulatory framework, the Company has established an internal Compliance Function. COIMA SGR designated a Chief Compliance Officer, who is in charge of ensuring that company is complying with all applicable laws, rules and regulations, as well as internal codes of conduct, policies and procedures. The Chief Compliance Officer is also Head of the Anti-Money laundering Function.
