Published today interview to Massimo Caputi on Milano Finanza, by Andrea Montanari. (Translated in english)

There’s a “State treasure”  that just waits to be appreciated.  It concerns the ground lease of the State property concessions, a matter that is attracting the real estate professional’s attention. Pity that red tape and slowness of policy makers haven’t made possible a definitive solution to exploit this potential field and maximize returns out of these assets laying inside the Italian State properties.

As the main event of the Industry in Italy, the Expo Italia Real Estate, is taking place today till tomorrow, crops up the proposal of one of the major experts of the sector: Massimo Caputi, in the market since the Nineties who, after the FIMIT adventure, is now leading Prelios Spa as Vice President of the company. “I will say this in my personal capacity, as I am man of this industry besides my assignements, as I don’t wish such a systemic operation as I imagining it,  to be misinterpreted” Says to MF Milano Finanza Massimo Caputi, Engineer from Chieti, born in 1952. 

 

The starting point is a single market data: the annual value of the ground lease of the property concession by the State Property Administrations’ esteem is worth 130 million Euros. “It is a ridiculous amount if we take into consideration the number of concessions of the State assets, the miles of beach under concession” specifies Caputi. On the basis of the real estate specialists evaluations “ it is likely that the total amount of the annual ground lease of property concessions could be worth more than 10 to 15 times” the present value.

The paralysis of the policy makers must be unlocked. Only the private sector can give that wakeup call. And here it goes with the proposal of the real estate manager.

 

“Allow the contribution of the various property concessions to a multi asset fund, with no more than 50 years of duration to be managed by one or few Sgr ( Asset management company permitted by the Italian law and authorities ndt) with adequate and renowned standing” . Caputi believes that as it is accomplished this preliminary step,  there can be identified two classes of shares: the A class, “which could be allocated by institutional non speculative Italian and International investors. Assigning to these shareholders an amount equal to the current value of the annual ground lease of the concessions and in addition a further 20%  of the returns gained by increased fares”.

What about the other class of shares, the B Class. “ These could be owned directly or  indirectly by the State, Regions or other Public Local Entities” explains Caputi. “To these bodies will be assigned a share of 80% of the proceeds gained by the increased ground lease of the property concession fares” Also the B shares could be “ transferred as the assets under management of the fund have gained the aimed returns”. The fund asset could be estimated for example  2 Billion Euro, a value based on adding an 8% yield to the current value of the ground lease of property concession. In other word the idea of Caputi would let public bodies to gain immediately cash by selling shares of the fund, having in the meantime guaranteed an interesting annual return.