The crisis in the Italian construction industry appears to be music to the ears of foreign investors, according to an article in today’s Wall Street Journal.

Between January and the beginning of October, foreign investment in Italian property totalled 2.75 billion euros, the highest amount since 2007, according to data provided by Real Capital Analytics.

According to the US daily, with greater confidence in an upturn in the Eurozone, investors are increasingly set on buying in the countries most at risk, such as Spain and Italy.

The main players in the biggest deals of 2013 are investors who had never made real estate acquisitions in Italy. For example, at the beginning of October Morgan Stanley, which had not been active in buying and selling Italian real estate since 2007, announced that it had acquired majority shares in 13 shopping centres – a total investment of around 635 million euros.

In May Allianz purchased two buildings, in Milan and in Rome. It hadn’t made property investments in Italy since 2008. And following the deal, worth 90 million euros, the German insurance company plans to invest a further 500 million euros in property, according to Mauro Montagner, CEO of Allianz Real Estate Italy.

According to the Wall Street Journal’, Blackstone, which has been investing in shopping centres in Northern Italy in recent months, is currently in talks to buy the historic offices of the Corriere della Sera newspaper for 120 million euros.

However, not everybody sees Italy as a property Eldorado. Many investors are put off by a political and economic system in which transparency and clear rules are often lacking.

Yet Italy continues to be attractive. In places such as the UK, Germany and Sweden, prices in some cases have returned to pre-crisis levels, with returns of around 5%. In contrast, markets such as Italy, Spain, Portugal, Ireland and Greece still offer returns of 7.3% for residential and 8.4% for commercial property.

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