Chinese are snapping up property throughout Italy to enjoy the country's culture and natural beauty

The recent big-money purchases of Serie A football clubs by Chinese investors may be making the headlines, but corporations aren't the only ones investing heavily in Italy.

Wealthy and middle-class Chinese are also buying up property nationwide to grab a slice of la dolce vita, the sweet life, for which the country is renowned.

A country house in the Milanese countryside that was sold to a Chinese client. Provided to China Daily

In the past 18 months, Chinese nationals have spent 600 million euros ($658 million) on Italian property, according World Capital Group, a real estate consultancy based in Milan with offices in Beijing and Shanghai.

The company's CEO, Andrea Faini, who is also a business adviser to the China-Italy Chamber of Commerce, says he works closely with Chinese investors and banks, including Bank of China and China Construction Bank.

Both have opened branches in Milan to facilitate transactions, while Agriculture Bank of China is considering following suit, he says, suggesting the banks' presence is an indicator of the robust Chinese activity in Italy.

Alberto Rossi, an analyst with Fondazione Italia Cina, an independent network of Chinese and Italian enterprises, estimates last year "certainly saw an increase of at least 35 percent", as more rich Chinese put money into property.

According to an Il Giornale newspaper report that cited a Bank of China study, 60 percent of wealthy Chinese are investing in Italian real estate.

The motivations are myriad. "Some are investing for resale and rental, some are simply buying second homes, and some are buying as they move to Europe on investor visas," Faini explains.

"Certainly, the Chinese love Italian homes, and the reasons are fairly evident," he adds, saying that entrepreneurs, venture capitalists and middle-class citizens alike are all drawn by the allure of the Italian style of life.

Another fundamental reason is that property prices have fallen for more than seven consecutive years, by an average of 23 percent since 2008, according to the European Central Bank.

Relatively low prices today continue to fuel investment, although Nomisma, an economic research company, has forecast residential home prices will rise an average of 1.7 percent in 2017.

Chinese buyers are largely concentrated in Milan, Venice, Rome and Florence, but properties in lesser-known areas such as Bologna, Perugia and Udine are also popular.

Faini says Milan is the top real estate market for his Chinese clients due to its economic environment, services and quality of life, among other factors. "Milan is more attractive to the Chinese as it's a capital of fashion and design," he says.

Apartments in the city's historic center can sell for 4,400 to 17,500 euros per square meter, while those in outlying areas go for 2,000 to 10,000 euros per sq m.

In the past two years, World Capital Group has handled transactions worth a combined 25 million euros for Chinese clients, mostly business executives buying apartments, more often than not in Milan.

"They love Milan because it's a livable, bite-sized city that offers high-quality Western education for their children," Faini says.

The city's most sought-after, and expensive, properties are renovated historic apartments. Yet Faini says a new trend now is for Chinese to invest in serviced apartments, such as those at the four-star Ramada Hotel.

"Prices start at 200,000 euros for a 50-sq-m apartment," he says. "In addition, also very attractive in the historic center are the Armani apartments that cost on average 600,000 euros for 50 sq m."

World Capital Group recently sold a villa on the outskirts of Milan to a Bejing family for 800,000 euros. "The total surface area is 230 sq m plus garden," Faini adds. "Prices are rock-bottom on the edge of town."

Fosun Group, a Chinese conglomerate, has invested 350 million euros in a building on Milan's central Piazza Cordusio that will be made into offices, apartments and a hotel. Work is underway on the 35,000-sq-m property.

Chinese Investment Ltd has also injected 70 million euros in a Milanese residential area called Porta Nuova, where it plans to buy a residential high-rise.

"Milan is a very important city for the Chinese," says Zhu Xiaodong, CEO of China Investment Ltd.

Milan saw the biggest increase in the number of homes sold last year, up 13.4 percent. Residential property sales in Rome also rose by 0.8 percent.

Homes in Rome are more affordable, with prices ranging from 4,000 to 15,000 euros per sq m. In Venice, one of the world's most visited cities, prices remain high, ranging from 8,000 to 20,000 euros per sq m.

Experts say buying property in Italy is a great way to protect hard-won capital because it retains an intrinsic value even as price bubbles come and go.

"The Italian real estate market is solid," Faini says. Maurizio Fabiani, founder of Luxurideas, a real estate company in Milan, adds: "Chinese love Italian homes because they can own the freehold, the building and the land it stands on, outright in perpetuity."

One recent development is the purchase of the historic State Printing Office and Mint building in Rome's Piazza Verdi. The building will be converted into a luxury hotel managed by Rosewood Hotels and Resorts International Ltd, a subsidiary of New World China Land Ltd.

When it comes to buying homes, Fabiani says most of his Chinese clients are not businesspeople but retirees or those close to retiring.

"They're tempted by the dream of buying a property in the Italian countryside, spending holidays there and converting it into a nice earner in their old age," he says.

In particular, Chinese clients "love panoramic locations and historic dwellings with frescoes", and have shown a preference for properties on Lake Como or renovated farmhouses in Tuscany and Umbria surrounded by greenery and packed with classic features like terracotta floors and wooden beams.

"Some of these beautiful properties can be sold at the bargain price of 2,000 euros per sq m," he says. "The Chinese love nature and clean air, and they are fascinated by la dolce vita, our food and our wine."

For China Daily

(China Daily European Weekly 07/29/2016 page25)