Italy’s Institutional Real Estate Market Rebounds

A Market in Recovery with Momentum Building

According to BNP Paribas Real Estate, Italy recorded approximately €7.5 billion in institutional real estate investments in the first nine months of 2025, up 13% over the same period in 2024, and trending above the 5 and 10-year averages (+14% and +19%, respectively).

This isn’t a short-term spike. On a rolling 12-month basis, the market is up 18%, signaling renewed conviction from investors looking for real value across sectors — particularly outside the traditional Milan-Rome axis.

Residential and Hospitality: The Core of a Lifestyle Investment Thesis

Two asset classes stand out in 2025 — and both reflect a deep lifestyle alignment:

• Residential (especially “Living” under Alternatives): Investors are targeting long-term value, focusing on high-quality homes in prime destinations, including second-home markets like Lake Como, the Tuscan countryside, and key Adriatic and Ligurian locales. Italy’s supply constraints and unique architectural heritage continue to underpin capital appreciation.
• Hospitality: Up +91% YOY and +56% over the 5-year average, this sector is attracting serious interest from institutional capital, family offices, and owner-operators. With 69% of deals outside Milan and Rome, the focus has shifted to leisure markets, boutique repositionings, and end-of-cycle value-add opportunities. Properties that blend historical charm with modern luxury, especially in destinations like Lake Como, are at the top of every shortlist.

As someone who advises on both residential and hospitality assets in Lake Como and beyond, I see firsthand how these sectors intersect. Buyers aren’t just investing in square meters — they’re buying into legacy, beauty, and long-term usability.

Development: A Strategic Play

Development oriented capital is also making its move, particularly where rezoning, conversions, and value-add repositioning align with lifestyle demand. From off-market heritage villas in Lake Como to modern luxury apartments in Italian art cities, investors are actively scouting deals with a strong story and long-term exit upside.

These aren’t speculative plays. They’re backed by planning diligence, heritage advisory, and market alignment and they require the right team to unlock their full potential.

What About Retail, Office, and Logistics?

• Retail: Up +16% YOY and +108% above the 5-year average, showing clear recovery. But interest is primarily in mixed-use urban assets and conversion potential, not traditional high-street retail alone.
• Office: A modest recovery, with 23% of total investment. Still in line with historical trends, but requiring careful tenant strategy and location discipline.
• Logistics: Down -23% YOY, though still consistent with long-term levels. A necessary recalibration after explosive growth — but no longer the star performer.

The Bottom Line

Italy’s institutional real estate market is growing again but the real opportunity lies where lifestyle meets legacy. Residential and hospitality remain the most compelling plays for long-term investors seeking stability, value, and cultural resonance.

And markets like Lake Como, with their unmatched quality of life, design heritage, and global appeal, are uniquely positioned to lead this next cycle.

If you’re looking to invest in prime residential, hospitality, or development opportunities in Italy especially in Lake Como, I’d be glad to offer insight and off-market access. Let’s talk strategy.