An interview with Luigi Roth, president of Fondazione Fiera Milano, in the opening days of the New Rho-Pero Fair Complex
How was the idea of transforming the Milan Fair Complex born?
Movement of the exhibition complex far from the centre of the city and the increase in the exhibition space of the Milan Fair are projects that have been in the air since the Sixties, with various solutions considered. The project started to concretise with the 1994 Programme Agreement which included the construction of a new fair settlement. From that moment onwards, thanks to the passage of the “fair” propensity of the State to the regions, the project began a decisive acceleration.
In 1997 the first extension began with the three new Portello pavilions, the “stick” that was connected to the quadrilateral of the Fair and extended in a North West direction, towards the motorways. Useful at that time, but it would only have solved the problem partially: even with this new extension all growing demands in terms of functionality and modernisation of the plant could not be satisfied; in any case, the problem of urban viability and the lack of parking spaces still existed.
When the project began, the old Milan Fair Complex changed its company organisation. What is Fondazione Fiera Milano today? Why did it change?
In 2000, with the support of the Lombardy Region, Fondazione Fiera Milano was created, a private law foundation born from the Independent Organisation of the Milan International Fair Complex. Therefore, the old Fair Institution became a group, divided up into two separate realities: Fondazione Fiera Milano, the main holding of the group and Fiera Milano Spa, active in management of the fair system (almost 80 exhibitions every year with more than 30,000 exhibitors and more than 4.5 million visitors). Just a short while afterwards Sviluppo Sistema Fiera was born, an engineering and contracting company for large projects and territorial redevelopment, created with the objective of following the entire transformation process of the Milan fair complex: the creation of the New Rho-Pero Centre, redevelopment of part of the historical fair complex in Milan and the new organisation of the Urban Centre.
The initial change was useful to Fondazione Fiera Milano an entrepreneurial function. It strengthened the role of the Fair, as an economic structure with a positive effect on the economy of the region and of the Country and also as a promoter of independent development initiatives and at the same time coordinated with institutions, in the best interests of the community.
How was the Milan Fair complex transformed?
The reality of the Fair is something that requires extreme attention, most of all because it represents the first economic operator of the Lombardy region, thanks to its structure. And also because it is a company that influences the development factors of the city of Milan: the territory and the life of citizens, culture, the society, companies. To continue growing, it has been forced to face a huge change: in primis the transfer of the majority of its fairs to the adjacent Milanese province, to a larger and more functional structure, which has been completed today: the New Fair Complex in Rho-Pero. A part of the current Fair, however, is still in Milan and will host fairs with a “lighter” impact on the city, while the other part will be disposed of at the beginning of 2006, after the Fair has been moved. In its place by the year 2014 CityLife, the group of companies and designers that won the international tender launched for the area, will execute a modern urban project for Milan, the symbol of which has become the three skyscrapers surrounded by glass and water.
Which economic results are expected for the future of the Fair, once it has been completed?
A key role in its transformation has definitely been the interest in the development of fair business: the objectives therefore are to increase the portfolio of the fairs held in Milan, one of the largest economic operators of the Lombardy region and also the direct economic effect on the territory which currently represents more than 2 billion Euros per year. Studies carried out by Fondazione Fiera Milano together with CERTeT (Economy, regional, Transport and Tourism Centre) of the Bocconi University, the exhibition system organised in two centres (the New Centre in construction at Rho-Pero and the Urban Centre in Milan) will produce wealth at a regional level with a value of 4.3 billion Euro, creating more than 42,700 jobs.
What is the value of investments made in this transformation?
The investments made by Fondazione Fiera Milano have been very large, because the New Centre has been entirely self-financed. We have estimated an investment of approximately 900 million Euro, entirely sustained by the Foundation, which includes the creation of the New Centre, the acquisition of the areas of Rho-Pero and the transfer of fair activities from Milan to the New Centre. Credit lines were granted by a pool of banks led by Banca Intesa and its sources of reimbursement are connected to extraordinary operations such as the takings from the OPV and OPS shares of quotations of Fiera Milano Spa in the Stock Exchange and from the sale of two thirds of the current exhibition area, as well as the possibility of self-finance deriving from ordinary management.
The Milan Fair Complex as a development engine of the territory: what is the current relationship of Fondazione Fiera with the city of Milan and its surroundings?
In almost a century of activity, growing to its current dimensions, the Fair has become mechanism which is more and more complicated, to be regulated with extreme balance in all of its exhibitions. And it is also one of the institutions that characterises Milan, after the Dome and la Scala: how could we not hope for the Fair to grow, how could we not hope that it makes a step forward in terms of quality on an international level? The new launch of Milan has also begun from the new Milanese fair system: an acceleration and renewal factor of a community that is no longer must Milan or the Lombardy region, but all of Italy.
The “key” to a successful interpretation has been to understand that, more than a “fair” in a general sense, we should have worried about the territory, economy of the territory and its relations. It would have been misleading to start with a company approach, from “fair companies”, that is to say starting with the company. A serious mistake because the fair, in turn, deals with other companies, it “produces” structures, innovation, exchanges, culture: a complex network that develops on a local level in a strong direct structure and represents a centre of competitiveness for the Country, on an international level.
Has Milan overcome its identity crisis? Compared with other European metropolitans areas why is it so special? How does the Fair want to document it?
The choice of undertaking, as in the case of Fondazione Fiera Milano, the transformation process of the Milanese fair system was born from the demand to do something special for Milan. A city that has taken the risk (a risk that now appears to be conjured, considering the number of new projects underway and the interest of those whose opinion of the city really counts) of being excluded from international circuits as well as loosing its position with regards to other Italian cities, in terms of liveability and culture, but most of all in terms of economic attractiveness. Because Milan lives in a world of business and finance: it is a city of business where, among the other excellent connections, the Fair machine plays a very important role. A role of excellence for more than eighty years, in which the development of the culture of fair exchanges is intertwined with the history of Italy and its contacts with the rest of the world, that the historical Archives of the Milan Fair, recently brought back to light, documents with extreme precision.
The New Milan Fair Complex has now been completed and is ready to host the first fairs. The gradual transfer of all large fairs of Fiera Milano will begin tomorrow and the system will start to operate. What are the factors of success of this operation?
First of all the method: Fondazione Fiera Milano interacts with the territory using a “network” business model and at the same time a modern management model of large structures. An alliance system between economic adjoining individuals and institutional representations, in which each one has provided its own contribution and has received advantages in terms of development or territorial governance. A method that has allowed Fondazione Fiera Milano to hold the reigns of such an articulated and complex project, to radically transform the territory, the economy and the company of its Region.
All of this has been possible for two reasons: first of all the coordination and sharing of responsibilities with the Institutions A real subsidiary relationship between FFM and its institutional references, on a local and on a national level. A subsidiary relationship considered as a collaboration between individuals and not as a private proxy of what the State or local organisations are not capable of doing on their own. Secondly, the active role of finance has played an important role, which has made this project possible and has put its trust in it. It is a new finance, the one asked to intervene in large projects with a risk capital that respect results and economic accounts: a finance that has given trust to a healthy entrepreneurial form, to its transparent methods.
Has the method been successful? What are the results of this transformation experience of the Milan fair system?
The first result was of a general growth of the entire network: on the one hand the Fiera company was enhanced by the new structure. A leader in its field due to the number of spaces sold, Fiera Milano is now advanced not only in terms of its exhibition services but also in terms of aesthetics, welcoming and infra-structural equipment throughout the territory. On the other hand companies from the Lombardy region and Italian companies in general can enjoy a structure which is even more competitive in the world.
The second result was recognition of the fact that Fondazione Fiera Milano is probably a unique reality at the moment. It is a “foundation of development”, an individual, an intermediate organisation which creates values such as “an incubator of projects” and acts as a kind of glue between various players with the same objective. An individual that brings together institutions, finance, research and development, market and collective interest in a mutual dimension of collaboration and sharing, and that undertakes to conclude useful works for the territory and for its economy. For the entire community.