July 15, 2019 / 2:07 PM / a month ago

Italy to launch real estate plan this week, seeks 950 mln euros -source

ROME, July 15 (Reuters) - Italy will unveil a long-awaited plan this week to raise some 950 million euros ($1.07 billion) in 2019 from the sale and rent of real estate assets, a source familiar with the matter said on Monday.

The source said the government had put together a portfolio of properties worth an estimated 1.2 billion euros for the project as the Treasury battles to meet its debt and deficit goals under the watchful eye of the European Commission.

“The decree to implement the plan is expected to be published tomorrow in the Official Gazette,” the source said.

The government has committed to privatisations worth 18 billion euros this year, including the real estate sales, to rein in its debt-to-GDP ratio, proportionally the highest in the euro zone after Greece’s.

No major sell-offs have been announced so far in 2019.

Property disposals reduce both debt and deficit according to European Union rules.

Many analysts are sceptical about the latest privatisation goals and the ruling coalition, made up of the far right League and anti-establishment 5-Star Movement, is already focused on the 2020 budget where it has promised swingeing tax cuts.

Italy pocketed just 60 million euros from privatisations in 2017-2018, less than 1% of the official target of 10 billion euros, Bank of Italy data showed.

Italy’s debt has risen from a pre-crisis low of below 104% in terms of GDP hit in 2007 to 132.2 percent at the end of last year and the European Commission expects it rise further this year and next.

As part of the latest real estate plan, Invimit, the asset management company owned by the Treasury, will manage a property portfolio worth 610 million euros, source said. (1 = 0.8872 euros) (Reporting by Giuseppe Fonte, editing by Crispian Balmer )

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