Suisse Romande Property Fund with higher rents and lower portfolio value

Rental growth at Suisse Romande Property Fund (SRPF) was 3.1%, with total income increasing to CHF 19.3 million from CHF 18.7 million. Net income for 2022 increased by 1.7% to 8.46 million CHF, excluding the extraordinary income from 2021, this corresponds to an increase of 20%, according to the fund management company JSS Real Estate Management. The fund's total expenses decreased by 8.9%, and borrowing costs decreased by 15.4%, with the weighted average interest rate decreasing from 0.81% in 2021 to 0.66% in 2022. These results enabled the distribution of a higher dividend than in the previous year, JSS Real Estate Management informs. This is now expected to be CHF3.00 and is based on a prudent approach with a payout ratio of 95.2%.

Against the backdrop of interest rate rises in the second half of 2022 and their impact on the real estate market, the fund management had expected a market decline in the fund's portfolio, the annual report states. The market value decreased by 4.7% to CHF 462.4 million as of December 31, 2022, with commercial real estate and properties in peripheral locations being the most affected, it said. In the income statement, the fund shows unrealized capital losses of CHF 18.28 million. In the previous year, there had been a profit of CHF 19.97 million. The overall result deteriorated from +26.9 to around -9.4 million CHF. (aw)