Public Real Estate Investment Trusts


Public Real Estate Investment Trusts (REITs) were born with the intent to ensure more efficiency in developing and increasing the value of real estate assets owned by the State, Regional Authorities, other Public Authorities and companies completely controlled by the aforementioned entities.

In order to further encourage the use of REITs within a wider process of rationalisation and development of public estates, Invimit SGR S.p.A. was established by Art. 33, par. 1, D.L. no. 98 of 06/07/2011 converted, after amendment, by Law no. 164 of 15/07/2011, following a decree of the Ministry of Economics and Finance on 19/03/2013. Invimit SGR is a fully subsidiary company of the Ministry of Economics and Finance and has the objective to:

  • Promote and manage direct, personal or third-party’s REITs, etsablished to reduce public debt and generate economies of scale, encouraging development on the territory (the so-called “Direct Funds”);
  • Invest, through the Fund of Funds in Target Funds established by Local Authorities and managed by Asset Management Companies selected through public tenders. To this end, the company collects liquidity not only on the market of Qualified investors, but also from subjects meeting specific requirements such as Public Insurance or Social Security Authorities, as well as private insurance companies and the public financial institution Cassa Depositi e Prestiti S.p.A.

A relevant company in the context of public real estate assets’ development and disposal is CDP Investimenti SGR (CDPI SGR), an asset management company established on 24/02/2009 with 70% of its share capital controlled by CDP S.p.A. and 15% by ACRI (Funds and Savings Banks’ Association) and ABI (Italian Bank Association). CDPI SGR manages several public contribution real estate funds (e.g. Fondo Investimenti per l’Abitare, Fondo FIA2, Fondo Investimenti per la Valorizzazione, Fondo Investimenti per il Turismo) in the field of social housing, smart housing and smart working, as well as tourism and hotels.

Along with those subjects, the Italian Public Property Agency plays a fundamental role.

Managing about 46,000 State-owned assets, in accordance with Art. 33-bis, Law no. 111 of 15/07/2011, the Agency promotes initiatives for establishing, without further burdening the public finance, companies, consortia or REITs having the aim of developing, transforming, managing and selling public real estate assets owned by the State, Regions, Provinces, Metropolitan Cities, Municipalities and other supervised bodies, as well as real estate rights, also for State-owned properties.

Qualified investors can invest in Public REITs by participating in their management and collecting, upon settlement, the price of the properties once placed on the market.



Chapter II “Real Estate Investment Trusts”, Articles 34-42, D.L. no. 58 of 24/02/1998 “Code of provisions on financial intermediation, pursuant to Articles 8 and 21, Law no. 52 of 06/02/1996”

Art. 33 of D.L. no. 98 of 06/06/2011 “Provisions on real estate development”  converted into Law no.111 of 15/07/2011 “Urgent provisions for financial stabilisation”

Art. 33-bis, D.L. no. 98 of  6/07/2011 “Subsidiary instruments for public real estate assets’ management”  converted into Law no.111 of 15/07/2011 “Urgent provisions for financial stabilisation”

Art. 14-bis, Law no. 86 of 25/06/1994 “Closed-ended Real Estate Investment Trusts”

Art. 3, Law no. 662 of 23/12/1996 “Public finance’s rationalisation measures”

DECREE OF THE MINISTRY OF ECONOMICS AND FINANCE no. 30 of 05/03/2015 “Implementing regulation of Art. 39, D.L. no 58 of 24/02/1998 (Code on Financial Intermediation) concerning the determination of general criteria for Italian UCIs (Undertakings in Collective Investments)”



Reuse or Development Projects

The introduction or transfer of properties to REITs must take place on the basis of reusing or development projects approved by resolution of the governing body of the public owner, after selection of the Asset Management Company managing it.

Generally, on the basis of these projects, the REIT pledges to redevelop the properties which, once completed, will be given for usage to public authorities and privates in exchange of management and rental fees for a certain period of time.

The Asset Management Company Selection

Art. 33 of D.L. no. 98 of 06/06/2011, converted into Law no. 111 of 15/07/2011, specifically laid down that the selection of the Asset Management Company shall be decided via “public tenders“.

Hence, the procedure to submit proposals for public works or services under concession, in compliance with Art. 183, par. 15, D.L. no. 50 of 2016, can be used to select the SGR interested in establishing a fund.

In this case, the Asset Management Company shall submit to a Contracting Authority (e.g. a Municipality) a proposal regarding the assets specified in the Real Estate Sale and Development Plan, with the same content and following the same procedure set forth in Art. 183, par. 15, D.L. no. 50 of 2016.

For the description of the procedure set forth in Art. 183, par. 15, D.L. no. 50 of 2016, please see Public-Private Partnership – Project Financing on Public Real Estate Assets

For further information, please see the Invimit’s Handbook for Investments.

Contract Subscription with the Asset Management Company

Once the Asset Management Company has been selected, it signs a contract with the competent Public Administration for establishing a fund for the development of the transferred real estate properties.

Exclusion Criteria and Proof of Compliance

With reference to the general requirements laid down in the current legislation for participating in public tenders, notwithstanding the requirement to verify any eventual provision of each specific call, it is necessary to specify that:

  • Usually, by moral requirements, reference is made to those provided for in Art. 80, D.L. no.50 of 18/04/2016 “Code of Public Contracts”; the competitor shall prove to hold the aforementioned requirements when taking part in the call, while the competent authority shall then verify all the requirements once the tender has been submitted. More specifically, public administrations may request the following documents: a certificate issued by the Criminal Records Office or, if unavailable, an equivalent document issued by the judicial or administrative authority of the Member State or of the Country of origin in which the envisaged requirements are met; appropriate certification issued by the competent fiscal authority and, as far as social security contributions are concerned, the certificate of social security compliance automatically acquired by the public administration from social security institutions pursuant to current legislation or, if unavailable, an equivalent certificate issued by competent authorities of other States.
  • Economic and financial standing, declared when taking part in the call, can be proved through one or more of the following: appropriate bank declarations or, if any, evidence of relevant professional risk’s indemnity insurance; balance sheets or extracts from balance sheets, where publication of the balance sheet is required under the law of the Country in which the economic operator is established; a statement of the undertaking’s overall turnover and, if any, of turnover in the area covered by the contract for a maximum of the last three financial years available, depending on the date on which the undertaking was set up or the economic operator started trading, insofar as the information of these turnovers is available. If, for any valid reason, the economic operator is unable to provide the references requested by the Contracting Authority, he may prove his economic and financial standing by any other document which the Contracting Authority considers appropriate.
  • The technical capability of the economic operator, declared upon taking part in the call, can be proved, inter alia, by: a) a list of the works carried out over the past five years, with the sums, dates and recipients, whether public or private, involved; b) the indication of the technicians or technical bodies involved, whether or not belonging directly to the economic operator’s undertaking, especially those responsible for quality control; c) a description of the technical facilities and measures used by the economic operator for ensuring quality as well as the undertaking’s study and research facilities; the educational and professional qualifications of the service provider or contractor and/or those of the undertaking’s managerial staff, provided they are not evaluated as award criteria; e) a statement of the average annual manpower of the service provider or contractor and the number of managerial staff for the last three years; f) a statement of the tools, plant or technical equipment available to the service provider or contractor for carrying out the contract.



Establishing a real estate fund takes 180-240 days. The duration of the fund is usually specified in the documents of the call for the selection of the Asset Management Company, as well as in the REIT’s regulation, and is strictly related to the time needed for the redevelopment of the properties and the pay-back time of the investment to the Asset Management Company. Usually, different types of shares’ subscriptions are allowed in order to regulate eventual shareholders’ rights (exit right included).



The private investor shall bear all the costs related to due diligence activities to be performed on the properties transferred to the REIT in order to verify any risks associated with the investment. In this phase the investor, besides being able to resort to party-appointed advisors and technical experts, can rely on the expertise of competent agencies (such as, according to the type of fund, Invimit SGR, CDPI SGR, State Property Office).



For example, the process of redeveloping or realising a school troughs a REIT could be as follows:

  • The concerned Municipality receives a proposal by an Asset Management Company for the establishment of a REIT;
  • The Municipality assesses the proposal and, if it is deemed of public interest, makes the Asset Management Company promoter, launching a call for tender in accordance to the national legislation on public procurement (public tender pursuant to Art. 183, par. 15, D.L. no. 50 of 2016). The promoter takes part and his proposal is laid as base. During the selection phase, the promoter will then be able to adapt his proposal according to the one deemed more advantageous by the Contracting Authority. In the case the promoter will not be entrusted, it will be reimbursed of its expenses (max 2.5% of the value of the investment);
  • The appointed Asset Management Company establishes the REIT, according to the Italian law;
  • The Municipality transfer to the REIT the surface rights (lasting 50 years) of the building area (or of the properties to be transformed), in order to realise new school facilities, as well as the property of the old schools, to be put on the market;
  • The Asset Management Company realises the new school facilities (or the expansion and/or upgrade of the existing structures);
  • Once the new school are completed, the Municipality could transfer the school into the new/renewed facilities. This would imply, on the one hand, the Municipality’s obligation to sign a lease contract with the Asset Management Company for the use of the new school and, on the other hand, the beginning of the private use/disposal of the old buildings, turning them into residential properties (with eventual annexed commercial areas) if possible according to the law and urban planning in the area.

Ultima modifica: March 9, 2018