Italy leases abandoned castles to luxury hoteliers for cash

Disused castles, fortresses, prisons and islands in Italy are to be converted into luxury hotels in a bid to boost tourism and fill the coffers of the debt-laden country.

The initiative is being modelled on Spain’s Paradores, luxury retreats located in monasteries, castles and other historic buildings, and could help chip away at Italy’s 1.9 trillion euro debt.

The Italian government has drawn up a list of abandoned architectural jewels around the country which it intends to offer for lease to private companies.

Leases will initially last for 50 years, with an option to extend for another 25. The buildings are in various states of abandonment, with their conversion into hotels expected to cost millions.

Properties on offer include the Bourbon-built Santo Stefano prison on the island of Ventotene in the Bay of Naples, a historic jail on the island of Procida and a seafront castle in the coastal town of Gaeta, south of Rome.

Two islands in Venice’s lagoon will also go under the hammer.

Poveglia is the site of a former quarantine station and a mental health hospital but has been uninhabited and off-limits to the public for years.

In the Middle Ages it was used for burying plague victims.

Also on the list is a former bishop’s palace in Trieste, in the far north-east of Italy, ex-army barracks in Modena and Parma and palaces in Piedmont in the north-west.

The project is being promoted by the government’s Agenzia del Demanio, or State Property Agency, which has come up with a list of 63 buildings suitable for conversion into boutique hotels.

Negotiations for the lease of 28 of them have already begun, while the rest will be publicised in the next few months. The cost of leasing the properties has yet to be worked out.

“We will put out the tender notices by the end of the year,” said Stefano Scalera, the director of the agency, at the launch of the project in Rome.

Tourism accounts for nearly nine per cent of Italy’s GDP and employs more than a million people, with the country attracting around 45 million tourists a year.

But a lack of coordinated marketing overseas has seen the country’s share of visitors decline in recent years.

“For 30 years everyone has been saying that tourism is fundamental for Italy, but during those 30 years we have been overtaken by other countries,” said Domenico Arcuri from Invitalia, an investment authority which is backing the plan.

“We plan to reverse that trend and to make use of these heritage buildings, which have an immense value.”

A handful of historic government-owned properties which have already been converted into hotels provide a model for the initiative.

They include Capo Spartivento, a 19th century lighthouse perched on a cliff in Sardinia, that has been turned into a luxurious boutique hotel, which costs up to £850 a night in the summer season.

If the leasing project proves a success, it could be extended – the state property agency has an estimated 1,000 other historic buildings on its books.