Swiss Prime Site (SPSN) CMD 2025 summary

Strategic transformation and business model evolution

• Transitioned from a diversified group to a focused real estate and asset management platform since 2020, reducing employee count from over 6,000 to 200 and shifting earnings mix to 87% from direct real estate investments.

• Now operates with two main pillars: direct investment in commercial real estate (core city locations) and asset management (primarily residential, including suburban areas), each with CHF 13 billion in assets under management by end-2024.

• Asset management pillar manages CHF 13.3bn AuM, targeting CHF 16bn+ by 2027, with 70% recurring fees and EBITDA margin above 50%.

• No current plans for further acquisitions in asset management or a spinoff; focus is on organic growth and leveraging economies of scale.

• Broad investor base of over 2,500, including 650 pension funds, leveraging the Swiss pension system's CHF 1.1tn in assets.

Portfolio optimization and capital allocation

• Executed CHF 1.3 billion in disposals since 2020, reinvesting proceeds into development pipeline and reducing retail exposure from over 30% to 19.7%, while increasing core location share from 88% to 96%.

• Reduced property count from 187 to 139, focusing on larger, higher-value, greener buildings, and increased rental income from CHF 425 million in 2020 to CHF 464 million, targeting CHF 500 million by 2028.

• Like-for-like rental growth exceeds 3%, with strong demand for lettings and a robust acquisition pipeline over CHF 600mn.

• Major projects include Jelmoli redevelopment (CHF 130mn), BERN 131 (CHF 80mn), and YOND Campus (CHF 150mn), all emphasizing sustainability and flexible use.

• Maintains a prudent financing strategy with a target LTV of 38% and an A3 Moody’s rating, with no immediate plans for significant deleveraging.

Growth outlook and financial guidance

• Targets resilient growth with a 10% FFO CAGR through 2028, driven by like-for-like rental growth, accretive acquisitions, development completions, and asset management expansion.

• Expects rental income to surpass CHF 500 million by 2028, with an EPRA cost ratio below 16% and asset management EBITDA of CHF 75 million.

• Dividend policy remains at 80-90% of FFO1, supporting attractive shareholder returns.

• Asset management expects to raise CHF 600-700 million in new equity annually, benefiting from Switzerland’s mandatory pension fund system, which allocates 23% of annual inflows to real estate.

• No significant CapEx required for rental reversion; focus is on lease renegotiations and tenant retention to capture 10% reversionary potential.