Foreign investment in Italian commercial real estate reached €2.75bn between January and October this year, or 79 percent of all commercial real estate transactions, as rising confidence in the Eurozone spurred investors to take a bet on riskier markets, according to data from Real Capital Analytics.
The amount is the largest investment in Italy's commercial real estate by foreigners since 2007. Some of the biggest investors include Morgan Stanley, which acquired a major stake in 13 Italian shopping malls as well as Germany's Allianz Real Estate, which bought two office buildings in Rome and Milan this year, according to a report in the Wall Street Journal.
Italy is expected to attract further foreign investment as the government seeks to sell 50 historic buildings in a bid to raise €502 million over the coming months. The sites for sale include a cardinal's palace, a castle near Rome and an island in the Venetian lagoon. The government hopes to atrract private businesses and investors with a view to converting the buildings into museums. restaurants and hotels.
"The move makes sense, given Italy's continuing popularity as a leading tourist destination," the report said.
Meanwhile, property buyers are also reported to be taking advantage of lower prices in Italy's residential market as they "look for that holiday home they've always wanted."
Italy is ranked as the fifth most popular destination globally by the World Bank and has just been voted Favourite Country in the 2013 Condé Nast Traveller Readers' Travel Awards, beating a wide range of other popular EU and non-EU destinations.
The country also took three of the top 10 positions when it came to Condé Nast readers' Favourite Overseas Cities, with Rome, Venice and Florence all being placed.
Eleven of Italy's hotels also featured in the 100 Best Hotels and Resorts in the World report by International Traveller Magazine – more than any other country.