The ‘Ca’ Granda case’, which benefits hospitals – but not only them

The inscription had been there for centuries, set beneath the large wall clock, before the bombings of ’43 brought almost everything down: “Diligite vigilantiam in munere vestro” – take care of what has been entrusted to you. It was a warning to those passing through the hospital courtyard. It has become the guiding principle of a story worth revisiting, because it tells of a Milan that, when it sets its mind to it, still knows how to get things done – and do them well. This is the ‘Ca’ Granda case’, the remarkable story of a public body capable of massively revaluing its assets, raising 200 million on its own to build a new hospital (a taster of which will be provided at the Sforza Pavilion Open Day on Sunday 25 October) and going far beyond that. A project officially launched in 2010, but with roots stretching back centuries.

It was 1456 when Francesco Sforza decided to establish a place that would care not only for the sick but for all the people of Milan, starting with the poor. What would become the Policlinico. And Milan reciprocated. With donations that, over time, became substantial: 8,400 hectares of land, around a hundred farmsteads, an abbey. And then, houses and palaces. “More than forty, almost all in the city centre,” explains Achille Lanzarini, director-general of the Fondazione Patrimonio Ca’ Granda. “The hospital is an institution that grew great thanks to the people. There was a mutual recognition.”

But there was also a very different model: “Hospitals were public charitable enterprises. And I emphasise ‘enterprises’ because asset management was not an afterthought, but the economic foundation. That was what they lived on.” They thrived on caring for what was entrusted to them. The problem is that, over the years, this care has faded. The management has changed. Until the reform of the 1970s, when hospitals became publicly funded healthcare organisations. “Income from property became superfluous; the hospital organisation specialised solely in healthcare management, and the skills required to manage the assets were lost.” The result: the properties, once a resource, became a problem. A huge one. They require maintenance, swallow up millions and, in return, yield low rents. This happened here too, for years. Then came 2010, when the new hospital was to be built and a programme agreement obliged the Policlinico to raise a large part of the millions required – at least 200 – itself. The Board of Directors, then led by Giancarlo Cesana, tasked Lanzarini with finding a solution. “In this sector, such an operation is simple: you have 44 buildings; you clear them all out, refurbish them and sell them for the highest possible price. But in our case, that would have been unacceptable speculation. Hundreds of families were at stake.” A conundrum. To solve it, he chose the wisest course of action: “I started asking questions.” He met, one by one, with the big names in property finance and asked them all to submit valuation models. “We turned the market into our adviser.” With Finlombarda’s support, they examined the possible strategies. And the right idea emerged: to transfer the buildings into a property fund, renovate them, and then sell half (to raise funds for the new hospital), whilst allocating the other half to social housing for families in need. The result was the creation of the Ca’ Granda Property Fund, which, since 2015, has been putting some of the buildings on the market and allocating hundreds of refurbished homes to social housing schemes. And given that, in the meantime, prices have skyrocketed, the Policlinico has seen its value rise far beyond expectations.

But that is only the first part of the story. The second part unfolds in the countryside, amongst the hectares of land and farmsteads scattered across 97 municipalities in 11 provinces. This represents another vast asset, facing the same problems as the buildings (low rents, maintenance, the chaos of the land registry) and the same challenge: to transform this dead weight into a treasure. By looking to its own history. “A quote by Gaudí struck me: ‘Originality is returning to one’s origins’,” says Lanzarini: “After all, that is what we have done: we have returned to the idea of a public charitable enterprise.” Here, this took the form of the Fondazione Patrimonio Ca’ Granda, established in 2014 with the same board of directors to manage the agricultural assets with the mission of supporting the Policlinico. Marco Giachetti, Cesana’s successor, confirms Lanzarini’s account. And he continues the work with a series of initiatives: the regularisation of land and buildings (“more than 1,200 cases”); an analysis of soil quality; the enhancement of the countryside’s other asset, water (“we have repaired leaks, installed sensors and control units, and created a real-time monitoring platform”); an agreement with Coldiretti, Confagricoltura and CIA to bring lease payments back to market levels (“this has enabled us to increase revenue by 50 per cent”). Plus a programme of ecological re-intensification, an academy for farmers, initiatives for schools and families, and an agreement to sell Ca’ Granda-branded milk and rice in Esselunga (“5 million packs and 400,000 euros for the Policlinico”). And what Lanzarini calls “the icing on the cake”, the Ca’ Granda Oasis: 45 hectares of renaturalised land at the end of Via Ripamonti, featuring animals, spaces for aperitifs and eco-friendly picnics. Last year it attracted 35,000 visitors. “We did it to tell our story – a centuries-old and beautiful one.” The Foundation’s financial statements are also looking increasingly healthy, to the benefit of the Policlinico: “In 10 years, we have increased revenue from 3.3 to 7.1 million, and net profit has risen from 735,000 euros to 2 million”. All whilst paying 15 million in IMU and giving a boost to the economies of many small towns.

When you take stock, the lesson that remains, in the end, is simple: “I find it hard to talk about innovation: we did what needed to be done. There is a need, which sets things in motion. There is a reality. All it took was a great deal of observation to identify the factors that help you make the most of it”. Factors that are now being shared. At the request of the Lombardy Region (which has just allocated funding of 102 million to cover additional costs, half of which will be repaid by the Policlinico), the Foundation has just amended its articles of association to make its know-how available to other public bodies “in accordance with the cooperation agreements provided for by Law 241/1990”. The ASP Golgi-Redaelli has already expressed interest. In short, the ‘Ca’ Granda case’ could spread. ‘As a manager, there’s one thing in particular that pleases me,’ says Lanzarini: ‘The public sector is usually portrayed as something dusty and run-down, incapable of functioning. But those who work there know that there’s also a great deal of expertise within it. And it is possible to put that into action.’