Why Italian real estate group Arras is setting up in Switzerland

Arras Group SpA, an Italian real estate developer based in Milan, created just four years ago, claims to be disruptive in a market that is currently saturated with the construction and sale of seaside villas and apartments. With 67 properties already sold and many more projects in Sardinia, Sicily, and Puglia, the group founded by Enrico Arras is now listed on the Milan Stock Exchange (August 2023). The company has chosen Switzerland for its first international branch outside of Italy. This choice is significant because Swiss customers account for 16% of sales, but even more in terms of value, as they generate the highest revenue for the group. Americans are the other group of clients who appreciate the concept implemented by Arras Group, which includes a digital sales platform coupled with digital solutions and interfaces for property design, planning, and management by customers. Enrico Arras explained in a video conference interview: “Arras Group develops premium second homes with beautiful views of the Mediterranean; they are very innovative constructions, with a cutting-edge eco-friendly approach and long-term sustainability. In fact, we are developing a digital application that will be ready in April 2024, allowing customers to manage their homes completely autonomously and remotely, thanks to Wi-Fi. They can monitor their homes, open doors, heat or cool the property, and more, as well as access maintenance services with a simple click.”

The presence of Jean-Christophe Babin, CEO of the Bulgari brand under the LVMH group, on the board of directors of the group, is a real plus for the founder. Enrico Arras continues: “Our meeting initially started with a completely typical approach, thanks to Jean-Christophe Babin's interest in a property in Sardinia. He bought one of our houses, then another. We then exchanged ideas extensively about Arras Group's business model and our IPO concept. He quickly showed interest and became the second-largest shareholder. He serves on the board of directors and brings a very interesting strategic vision without being involved in operations. He believes strongly in Arras Group's business model.” Indeed, the group is growing, as the revenue for 2022 totaled €9 million, and the following year, €11 million, with a significant increase expected in 2024, according to the founder.

So, what was the reason for going public? Jean-Christophe Babin, contacted by phone, explains: “I indeed approached the group for the purchase of a personal property. When Enrico told me about the IPO, I was immediately interested because of the concept of premium seaside villas, modern and ecological, positioned as very beautiful second residences with the assurance of a spectacular view of the Mediterranean, is very attractive and can genuinely interest international clients. We agreed on an amount that made me the second-largest shareholder in the group. This IPO enabled us to accelerate the development process. Arras’ villas stand out from what can be found in the market. The style is very contemporary, with large windows overlooking the sea, ecologically neutral, and with a high standard of quality that is not easy to find. The clientele looking to purchase a property for half a million euros or more (editor's note: prices start at €200’000) is the same as in watchmaking and jewelry, and I know them well. Another strong point is that Arras is very well established in Sardinia, an asset for offering beautiful land close to the sea. My villa, currently under construction, is located on the edge of a protected area and just a few meters from the beach. Sardinia, Sicily, or Puglia still offer beautiful land at much more affordable prices than the French Riviera.”

Arras Group's ambitions today are to double its Swiss clientele, thanks to the opening of the first showroom in Neuchâtel, where customers can come to discover materials and meet architects. But the goal is also to attract customers from northern Europe and beyond. Jean-Christophe Babin continues: “It is not excluded that we will approach China.” While he emphasizes his non-operational role, he goes on: “My presence on the board of directors is not operational; I work on strategic elements and establish links with certain institutions, but it doesn't occupy me beyond my weekends. I continue, and I will continue with Bulgari, of that there is no doubt. Above all, it's an investment in a field that I love and where I can add real value. Looking ahead, I'm interested in sitting on a few boards, but certainly not just sitting four times a year without contributing more. I like the idea of sharing my experience with a younger generation.”