Real Estate Residential

The actively managed investment group invests primarily in residential real estate in Switzerland.

Residential Real Estate in Switzerland

The actively managed investment group Immobilien Schweiz Wohnen invests primarily in residential real estate in Switzerland. Mixed properties with a predominantly residential component are also permitted. The portfolio rental income resulting from the residential portion must be at least 75%. In addition to purchases, contributions in kind, sales and renovations, new construction projects are also selectively realised. The aim of the value chain is to achieve the highest possible return commensurate with the risk.

Evaluation 

The entire real estate portfolio of the Swiss Residential Real Estate investment group is valued annually by external independent valuation experts. The market values are determined using the DCF method (discounted cash flow) and in accordance with the requirements of SWISS GAAP FER 26. The accredited real estate valuers are selected by the Commission Real Estate Switzerland Residential using a structured evaluation process. KPMG AG was used as the appraiser in the current financial year. The investment costs for new construction projects that have been started are capitalized. However, in the case of repair and renovation projects that have already been started, only the value-enhancing investment costs are capitalized; the remaining costs are depreciated through profit or loss. If purchases are made during the year, a new market value is determined at the end of the fiscal year. The average market value-weighted discount rate for the existing portfolio of Real Estate Switzerland Residential is 3.45%, with the range for individual properties extending from 2.64% to 4.25%.

Assets

The portfolio has a heterogeneous structure in terms of year of construction: About 40% of the portfolio (in m2 of energy reference area) was built before 1980, a quarter in the 1980s and 35% thereafter. Many buildings were renovated or partially renovated in the past. Accordingly, the renovation strategy and timing are individual for each property. Sustainable solutions for existing buildings must take into account the building substance and the local conditions.

Today, about 40% of the energy reference area of the portfolio is heated with sustainable energy sources. District heating accounts for a large part of this. About 35% of the area is heated with gas and 25% with oil. Oil-fired heating systems are still found mainly in smaller properties built before 1950.

Age structure by year of construction

in %

Sustainable investment activity 

All new construction projects of the last three years were built to the Minergie standard. Fossil fuels were not used for the heating systems. Avadis has already introduced a guideline for sustainable construction in new buildings in 2014, which was implemented in the projects. In all refurbishment projects of the last three years, we were able to take the existing oil heating systems out of service and replace them with a more climate-friendly energy source.

Distribution by object size

in %

Real Estate in Switzerland

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