Property investment group Lendlease has set up a joint venture with Canada Pension Plan Investment Board (CPP Investments) to invest some 400 million euros in the Milano Innovation District (MIND) project.
The joint venture, an alternative real estate investment fund, will target the development of Phase 1 of the West Gate area of MIND, a one million square meter development combining public institutions, offices, laboratories, homes and retail.
The joint venture between Lendlease and CPP Investments builds upon a strong relationship already established across projects at both Barangaroo in Sydney, Australia, and Elephant Park in London, U.K.
Housed on the former 2015 World Expo site, MIND is set to become a leading innovation district anchored by life sciences and technology. The development will comprise over one million square metres in surface area when including the public institutions. Lendlease’s private development rights cover around half the district’s area, which is 480,000 square metres, with an estimated development end value of circa 2.5 billion euros.
Public and private institutions form the foundation of MIND, which will deliver the new university campus of the Statale University for more than 18,000 students and the IRCSS Galeazzi hospital with more than 500 beds. The district will also be home to the Human Technopole, Italy’s new research institute for life science and other research centres; as well as the Federated Innovation™, an innovation ecosystem where more than 100 companies will be focused on co-creating discoveries in technology and life sciences. Offices, laboratories, new homes, retail, and public realm elements will sit alongside public institutions in a precinct where up to 60,000 people will live and work each day. CPP Investments and Lendlease have agreed to jointly invest circa 400 million euros of equity as a 50:50 joint venture in the Fund for the development and long-term ownership of approximately 150,000 square metres of the 480,000 square metres that Lendlease has private development rights for. The Fund will develop part of the West Gate area of MIND; the mixed use area will become a recognisable destination for researchers, workers, residents and other visitors to the district’s west entrance. The Fund will be managed by Lendlease Italy SGR SpA and Lendlease Services Srl will undertake the role of development and project manager. Sustainable design will be a major feature of MIND, in line with Lendlease’s global target to be a 1.5°C aligned company. MIND is planned to be a zero-carbon precinct powered only by renewable energy sources; a private smart grid is being developed on site as well as a next-gen low temperature, high efficiency district heating and cooling network. Renewable electricity will come from a variety of sources including solar panels on site. Andrea Ruckstuhl, Head of Continental Europe for Lendlease, said: “Innovation districts are becoming more and more a new asset class; there is a new sensibility on the importance of human centre innovation, in line with the objectives of the European Recovery Plan. MIND is the physical infrastructure where we will set the base and the foundation for the future, working on the talent attraction, the knowledge economy, the greatest challenge of our time, such as the decarbonization, and the social inclusion of the community. The momentum behind MIND is gaining pace and it is set to become a pioneering project for innovative modern design and sustainability.” Andrea Orlandi, Managing Director, Head of Real Estate Investments – Europe, CPP Investments. “This new destination in Milan is set to become one of the top life-sciences campuses in Europe, supported by a new leading Italian hospital and the University of Milan Life Science campus and research institute. We are providing long-term capital for this project which will ultimately generate strong risk-adjusted returns for CPP contributors and beneficiaries.” With end-to-end capabilities across all aspects of real estate – from concept and planning, to design and delivery through to funding and investment management, Lendlease is able to generate superior economic, social and environmental outcomes. As a result, the company is using that expertise to convert and deliver a £27bn pipeline of work in Europe alongside new and existing capital partners.