HINES AND CALE STREET FINALIZE AGREEMENT WITH MILANOSESTO S.P.A. TO INVEST 500 MILLION EUROS THROUGH A FUND MANAGED BY PRELIOS GROUP TO ACQUIRE AND DEVELOP THE FIRST PHASE OF THE 1.5 MILLION-SQUARE-METER MILANOSESTO PROJECT WITH FINANCIAL BACKING OF INTESA SANPAOLO GROUP.
Hines Italy is already the overall strategic advisor and development manager, together with Prelios Group as project manager, of the entire MilanoSesto development, the largest urban regeneration project in Italy and one of the largest in Europe.
Milan – October 21, 2020 – Hines, the international real estate firm, in partnership with Cale Street, a real estate investment and finance firm backed by the Kuwait Investment Office, has completed the signing of a framework agreement with Milanosesto S.p.A for the acquisition and development of “Unione Zero”, the first parcel to be developed in MilanoSesto – a project located in the north-east quadrant of Milan's metropolitan area, for which Hines Italy serves as a strategic advisor and development manager.
The first plot investment of 500 million euros, with Prelios Group as the fund manager, will fuel the development of approximately 250,000 gross square meters.
The master plan for MilanoSesto, designed by Foster + Partners, will transform a 1.5 million-square-meter area, into an attractive, dynamic, sustainable, progressive urban destination with new residential areas, best-in-class office environments, retail and hospitality. New town squares and modern, open-air public spaces will connect people, as plentiful green space spreads over 45 hectares, creating another large urban park for Milan, slated to be one of the largest in the Lombardy Region. Furthermore the project will be adjacent to the future City of Health and Research, a crucial public hub for clinical and scientific excellence formed by new branches of the Besta Neurological Institute and the Tumor Institute.
The first phase of development, set to begin in 2021, is subject to Milanosesto S.p.A obtaining all licenses and permits for the site’s infrastructure, as well as the completion and certification of already well-advanced remediation work for the “Unione Zero” parcel.
MilanoSesto will be at the forefront of modern city living and will strive to become a model for urban regeneration in Europe and globally. The project will include alternative residential product offering affordable rents to welcome a socioeconomically diverse collection of residents including students, families and the elderly. It will also include a range of spaces focused on encouraging social interactions and inclusiveness, as well as modern services designed for the needs of different generations, such as child care and co-working areas.
MilanoSesto aims to bridge the gap between demand and supply in relation to people’s living needs and social inequalities with a long-term perspective. The investment objective is to build a unique development project in Italy that is in line with the most advanced international environmental and social sustainability standards, the circular economy, and ESG principles. The approach is championed by Intesa Sanpaolo Group, which has supported the project from its very first stages, believing in this extraordinary opportunity not only for the Greater Milan area, but for the whole of Italy – ensuring the presence of an experienced and forward-thinking institutional investors in the project.
“We are very proud to have set in motion a project that will lead to the redevelopment of a very important area of the Greater Milan with a strong industrial tradition, which has been inactive for more than 20 years,” commented Mario Abbadessa, Senior Managing Director & Country Head of Hines Italy. “This region, one of Europe’s most dynamic and most promising, will see the launch of a sustainable and innovative residential development featuring affordable rents, links to the city center and modern services for students, families, and the more mature. This is another significant achievement for our Italian office and is the result of teamwork.”
“Prelios’ professionals have lavished great expertise and commitment in identifying a highly innovative solution for an area that is a real estate unicum. We are honored that Italy’s leading financial institution, Intesa Sanpaolo, has placed its trust in the capabilities of our Group,” Prelios Chairman Fabrizio Palenzona declared. “The MilanoSesto project is projected toward the future, young people, new lifestyles, and is an example of the application of ESG principles to urban regeneration on a European scale. Hines has the fundamental merit of having understood the area’s potential and deploying the strategies and best practices that only a world giant can access. This project is proof that with people of great vision like Carlo Messina, Italy can go far.”
“The MilanoSesto project is one of Europe's significant urban redevelopment plans, aiming to make Sesto San Giovanni an integral part of the Milan Metropolitan Area, including through the presence of leading structures such as the City of Health and Research,” said Carlo Messina, CEO of Intesa Sanpaolo. “The development of the MilanoSesto area, which is attracting top Italian and international real estate players such as Prelios and Hines, will benefit the whole community in terms of jobs. The redevelopment of the former Falck industrial areas alone will employ thousands of people, without counting indirect jobs, and added to these will be new jobs created for the structures dedicated to education, research and entertainment. In this regard, our involvement is part of our broader strategic goal to create the world's first Impact Bank serving sustainable and inclusive development."
"The choice of an international investor like Hines - Giuseppe Bonomi, CEO of Milanosesto S.p.A., stated - represents the best trusted companion to finally and concretely start the development phase of the area. I am very pleased with an agreement whose amount is the attitude to long-term investments. A feature that is fully consistent with Intesa Sanpaolo’s vision that in recent years has guaranteed the hold and the chance to a future for a precious and strategic portion of the Milan metropolitan area, whose disposal dates back almost a quarter of a century.”
The initiative is further confirmation of the success of Hines investment strategy in Italy, which is strongly geared toward a long-term industrial approach. Within large-scale urban regeneration projects, this translates to reclaiming and redeveloping abandoned areas into effective, sustainable, and inclusive urban communities based on a combination of services designed for a new intergenerational mix.