Guido George Lombardi, former Executive Director of the International Council for Economic Development, is an entrepreneur in the real estate field. For the past thirty years, he has been interested in economic politics and finance between the United States and Italy. Lombardi became known to the press primarily for his relationship with the President of the United States, Donald J. Trump, as an advisor. Before the American tycoon crossed the threshold of the White House, Lombardi managed The Donald’s group of followers on social media and during his recent visit to Italy, he was the reference point for the president in Italy. Currently, he lives on the 63rd floor of Trump Tower.
InvestorVisa: In addition to your activities for President Trump, you are a real estate developer. In light of your experience, what do you believe are the main criticalities in the real estate sector in Italy, as compared to the United States?
Lombardi: With respect to investments in the real estate sector, we see that many doors are starting to open, for Italian businesses to invest in Italy as well as for foreign companies investing here too (not necessarily American, and many Chinese). With Trump winning the election in the United States and hence since his inauguration on January 20th until today, the stock exchange has gone up by $3 trillion. An extraordinary amount and this money also flow into real estate although of an industrial type, rather than commercial. Unfortunately for Italy, since unless there is an economic shift upwards due to political stability (and therefore I imagine after the next elections), I think it will be difficult for those who are less educated as to risks to take any initiative. At the present time, the only domestic or foreign players available to take any initiatives in Italy are those who are willing to take some risks.
According to an estimate published by LuxuryEstate.com Made in Italy products and even manpower constitute value added in buying and selling luxury real estate. In the eyes of Americans, is Italy still a place of excellence?
Absolutely. In fact a few days ago we gave the Eccellenza Italiana Award in Washington, DC. It was very well received by leading Italians as well as Americans and so let’s just say that with respect to luxury in general (whether products or real estate) there is always this need. Italy is one of the top countries in the world, no one wants to invest in luxury apartments in Beijing.
As you are aware, Malta even offers non-EU investors citizenship through the purchase of real estate property, plus payment of EUR 650,000 in contributions. Consequently, with approximately one million Euros, one can become a European citizen. The Other Member States also offer visas and residency permits but not citizenship. Commencing this year Italy too will grant visas to non-EU investors, but only for investments in the capital of Italian companies or for donations of public interest, consequently real estate investments, whether or not residential, are excluded. Moreover, strict anti-recycling controls have been implemented. Do you believe that regulations as strict as the Italian ones would be a deterrent to big investors or that they could be considered a positive aspect, such as a guarantee for legality?
It’s a deterrent, compared to other countries. It could be something more with respect to what there was in the past however not when compared to what other countries such as Malta or even the United States are offering. With approximately one million dollars, even here in the States you can have a special visa which immediately gives you the opportunity to enter as an investor and you are absolutely free to invest wherever you wish, so in the commercial, industrial, residential properties or even your own home. The important thing to consider is that that available capital is what gives the US the certainty that the person in question is not someone who comes looking for work. That’s why it’s called an Investor’s Visa. I believe that Italy should follow the trend and adapt to what the other countries are doing and not always be behind them in everything.
It would seem, though, that the future of the EB-5 program is more and more uncertain. The EB-5 (immigrant investor visa) is a program dedicated to creating employment and contributing to the economic development of the country, encouraging investments by foreign citizens who are in turn granted the Green Card. After years of short-term extensions, it would seem that this program will no longer be renewed. What are your comments on this?
I’ve known Trump personally for 25 years and unless there has been a misunderstanding between him and the person deciding on these programs, the position of the Trump Administration is certainly not that of eliminating it. They might introduce more restrictions, that million dollars might need to be in a trust or distributed in such a way that it cannot return to where it came from. Unfortunately in the past a person could buy property, then got a loan from the banks with the excuse that the loan was not the investment, then, however, the loan returned to the country of origin and as a result, the net investment was not what it was supposed to be. There might be an inspection or two, but I doubt that they will eliminate it.
So all things considered the USA is moving towards more severity in this case?
More than increased severity I would say more transparency. As I always say, it’s not so much a question of restricting as of controlling the usual “sly operators”.
What would entice an American investor to invest in Italy?
Let’s say that the most important factor is taxation. Unfortunately, the average investor, I’m not talking about international investors or companies already operating in Italy, but about those who have to take the first step and are afraid of what the taxes will be or the possibility of being over-taxed with respect to the investment being made. What would really help new investments, especially in real estate properties, would be a clarification or better still simplification of real estate property taxes concerning foreign investors who invest in Italian real estate.
The Italian Government is moving in this direction, for example, if one requests the new visa for investors and decides to transfer one’s fiscal seat in Italy, one acquires the right for 15 years to a lump sum of EUR 100,000 per annum on income abroad. Would this measure reassure an investor?
Undoubtedly. Transparency and simplicity are the keywords for promoting investments of any kind.
With respect to the possibility of bestowing donations and in any case obtaining an Italian visa, is this a context that is similarly attractive as compared to investments?
Absolutely less so because in any case the United States, as well as Europe, have not quite recovered from the crisis. Even though a bit of optimism can be seen especially in American markets, but also in European markets, there’s still the fear that something can go wrong, a war in the Mid-East, terrorism or other things. Unfortunately, I would say that with respect to donations, aside from celebrities who are interested in doing good primarily for the works of art that in Italy absolutely must be protected, I’d say that there is still a bit of uncertainty, of trepidation. Sadly the economic situation, but also the domestic and international security situation, I think, are elements that keep possible donors at bay from Europe.