Government investment funds in Azerbaijan, Abu Dhabi and Qatar in the past two weeks have agreed to invest a combined €350 million ($380 million) to buy and develop three separate properties in Milan, according to a person familiar with the transactions.

The Abu Dhabi Investment Authority is buying a 1960s building that will be demolished to make way for a new tower, and the State Oil Fund of the Republic of Azerbaijan is buying a building from the Italian chamber of commerce, the person said. On Dec. 22, the Qatar Investment Authority agreed to buy a property from BNP Paribas SA.

The purchase prices weren’t disclosed. The €350 million includes the cost of redeveloping the three sites. All three will be managed by Italian property company Coima SGR, the person said.

Italy is a new destination for many sovereign-wealth funds, which invested $2.2 billion there in 2014—less than a fifth of the amount they invested in the U.K. that year, according to Bocconi University in Milan. That may be changing as the Italian economy, the third largest in the eurozone, picks up after a three-year recession. In February 2015, Qatar’s sovereign-wealth fund bought the 60% it didn’t already own in Milan’s €2 billion Porta Nuova finance district.

Real-estate markets boomed last year in Europe, as investors hunted for returns amid low interest rates and sky-high prices in London. Investors spent around $9.7 billion on Italian real estate last year, compared with $7.2 billion in 2014, according to data-firm Real Capital Analytics. Foreign buyers accounted for 90% of investment into Milan in the first nine months of last year, according to broker Knight Frank.

Spokesmen for the Qatar and Abu Dhabi funds declined to comment. A spokesman for the Azerbaijani fund didn’t immediately respond to a request for comment.

(Wall Street Journal)