PORTFOLIO – market environment

The portfolio is valued at CHF 1,518 million as at 31 December 2023 and consists mainly of  2,477 middle-income residential units in 152 buildings. These residential properties are to a large extent mid-range priced apartments located in the Lake Geneva region. The focus on this region and on this particular segment is the Group’s USP. Increased cash flow from rent like-for-like and continued double-digit rental growth potential of currently 12% underline the portfolio’s quality, despite a higher average real discount rate of 2.97% at 31 December 2023 (2.74% at 31 December 2022).

Detailed information on the properties is available on the Company website and in the property list in this Annual Report.

Bidding processes have experienced a significant reduction in liquidity. Residential properties, particularly in prime locations, remain popular. In the medium to long term, the interest rate spread between the risk-free 10-year Swiss government bond and real estate yields is expected to return to long-term equilibrium. 

Rue Daubin 35, Geneva – Renovation of the facade, new blinders, windows, heating system and elevators

Investis has developed its Properties business line for almost the last three decades. It generated revenues in 2023 of CHF 53.1 million. Like-for-like rental income increased by an excellent 3.1% and the vacancy rate was further reduced to a very low 0.9%. As a result, the segment achieved an impressive operating performance with an EBITDA of CHF 33.7 million, despite the sale of 11 properties in 2022. Due to the negative revaluation effect of CHF –47.7 million, the operating result (EBIT) came to CHF –13.9 million in 2023.  The prior-year figure included income from disposals of CHF 63.4 million, as well as positive revaluation effects of CHF 67.2 million.

Rental income fell by 8.2% due to the successful sale of 11 properties in the course of 2022 (total sales prices CHF 376 million all used for debt reduction).

An increase of the average discount rate by 23 basis points (bp) to 2.97% led to lower valuations and hence to a revaluation loss of CHF 47.7 million. 

INVESTMENT PROPERTIES – MAINLY RESIDENTIAL

Based on market value and main use, 90% of the properties are used for residential and 10% for commercial purposes. With such a high proportion of residential properties in the portfolio, the risk of vacancies is low. The concentration on the residential market in the Lake Geneva region is the Investis Group’s USP. Lively demand is still expected thanks to the continuing strongly positive demographic trend. With population growth of over 1%, Switzerland is one of the fastest-growing developed economies, while the cantons of Geneva and Vaud are benefiting over-proportionately. The following graphs depict the geographical distribution and main use of the investment properties:

RENT DEVELOPMENT

Over the years, Investis aims to achieve 1–2% annual like-for-like rental growth. Based on CBRE’s valuation report as at the end of 2023, the rent potential was estimated at +12%.

Gross rental income as at 31 December 2023 stood at CHF 57.9 million.