PSP Swiss Property: Profit increase thanks to property sales
PSP Swiss Property achieved a net profit (excluding valuation effects) of CHF 89 million in the first half of the year, compared to CHF 78.7 million in the same period last year. The main reason for the increase was the CHF 10.5 million success from the sale of condominiums at the "Salmenpark" project in Rheinfelden, the company says.
However, net income (including valuation effects) decreased from 88.2 million (H1 2015) to 65 million in the reporting period. The reason for this was a devaluation of 31.8 million in the context of the revaluation of the properties, according to PSP Swiss Property. 23.1 million was attributable to the investment portfolio, the remaining 8.7 million to project developments.
The higher rental income expected as a result of the renovations carried out and a ten basis points lower weighted average discount rate would have had a positive impact on the valuations. However, these drivers were not able to compensate for the impairments due to longer marketing periods, lower market rents in some cases, and higher renovation expenses for individual properties.
PSP Swiss Property's equity stood at CHF 3.78 billion (year-end 2015: 3.87 billion), corresponding to an equity ratio of 55.6 percent (year-end 2015: 57%).
Vacancy rate rises due to refurbishments
As of the end of June, the real estate portfolio comprised 163 office and commercial buildings as well as five development sites and three individual projects with a balance sheet value of CHF 6.737 billion. In June 2016, the investment property at Av. de Beauregard 1 in Fribourg was sold for 12.7 million. After the balance sheet date or on July 29, 2016, an office and commercial building at Hardturmstrasse/Förrlibuckstrasse in Zurich was purchased for 145 million.
The vacancy rate was 9.1 percent at the end of June, compared to 8.5 percent at the end of 2015. Of this 9.1 percent, one percentage point was due to ongoing renovation work on various properties, PSP Swiss Property said. The properties in Zurich West and Wallisellen, with an investment value of CHF 0.7 billion, contributed a total of 2.8 percentage points to the vacancy rate. The remaining properties with an investment value of CHF 5.5 billion (i.e. the total portfolio excluding properties under renovation as well as those in Zurich West and Wallisellen) accounted for 5.3 percentage points.
Full-year forecast: higher Ebitda, lower vacancy rate than expected
For the full 2016 financial year, Immobilien AG now expects Ebitda (excluding gains/losses on real estate investments) of over 240 million, compared with around 240 million previously. The vacancy rate at the end of 2016 is now expected to be around ten percent, mainly due to maturities towards the end of the year. Previously, PSP Swiss Property had expected a rate of eleven percent. (ah)
