Coima: Italy & Southern Europe a magnet for foreign capital

International capital is coming back to Southern Europe in general and to Italy in particular, Coima said in their first market update of 2025. Foreign investors accounted for 64% of transactions in Italy last year, up from 56% in 2023.

“Southern Europe is seen as less risky and more interesting by investors now, which is a positive,” said Manfredi Catella, founder & CEO, Coima. “There is a new willingness to invest in real estate, especially in living sectors and logistics. Capital is coming back, and we are talking to investors from all over the world.”

Transaction volumes increased by 50% last year, helped by the fact that market prices have declined by 30% on average since 2022 and that the ECB has been lowering interest rates.

“2025 has started well and we see momentum in the market,” said Gabriele Bonfiglioli, chief investment officer, Coima. “Investors are back, sentiment is positive and we believe this is the perfect window to act.”

There are opportunities across asset classes. The logistics sector, for example, has a 1.5% vacancy rate, the lowest in Europe, ensuring that rents keep growing while values are set to rise. Online shopping should provide a further boost to the sector, as e-commerce penetration is expected to increase by 69% between now and 2029.

The hotel sector is thriving as tourist numbers continue to rise: “Hospitality arrivals in Italy versus the number of available rooms is the highest in history,” said Bonfiglioli.

Office leasing activity is stable, as Italy has one of the lowest percentages of remote workers in the EU. Prime office rents are expected to increase by 35% to 2029, according to Coima, and there are plenty of opportunities to refurbish or repurpose obsolete office stock.

The residential sector, as in other European countries, has a supply and demand imbalance, especially in fast-growing cities like Milan. Italy’s business capital recorded a 13.4% GDP growth last year, the highest among all European cities.

“We are at an inflection point in the market,” said Bonfiglioli. “If you invest now where there is scarcity, then you will get above average returns.”