Helvetica Swiss Living Fund plans real estate sales
In order to reduce the debt ratio, the residential real estate fund intends to sell properties worth CHF 100 million.
The Helvetica Swiss Living Fund (HSL Fund) is planning to sell properties worth an estimated CHF 100 million. This was announced by the fund, which focuses on affordable housing, when it published its half-year figures. The proceeds will primarily be used to reduce debt and thus further lower financing costs. The aim is to reduce the debt ratio to around 39% by the end of the year.
The HSL Fund holds 62 residential properties with over 1,800 residential units. The market value of the properties as at June 30 was CHF 810.2 million (-1%). The debt ratio amounted to 45.85%.
Overall result turns negative
In the first half of 2023, the HSL Fund increased its occupancy rate to 97.0% (previous year: 95.2%), which is the highest figure since the fund was launched. Rental income amounted to CHF 14.5 million in the reporting period, an increase of CHF 3.6 million on the previous year. However, expenses increased significantly by CHF 5.1 million to CHF 9.6 million. Helvetica explains this with higher expenses for the properties acquired in the previous year and increased interest costs. Net income amounted to CHF 4.9 million (previous year: CHF 8.9 million). The portfolio recorded a devaluation of CHF 7.7 million under the item "unrealized capital losses". The overall result was negative at CHF 1.9 million, following a profit of CHF 11.6 million in the previous year.
The net performance of the HSL Fund was -2.3%, taking into account the distribution for the 2022 financial year of CHF 3.45, which was paid during the reporting period. The net asset value fell to CHF 112.43 per unit (CHF -3.94) and the return on investment was CHF -0.43%. The return on equity fell to -0.42%.
No capital increase this year
According to Helvetica, the fund wants to give priority to further increasing the occupancy rate, adjusting rental income to the rising reference interest rate and realizing potential in the properties. The fund management expects further growth in rental income. The annual tenant turnover rate of 15 percent offers the opportunity to substantially increase rents with minimal investment when tenants change
The fund is postponing the capital increase originally planned for this year until 2024. The fund management confirms that the strategic goal remains to list the fund on the stock exchange by the end of 2024. (ah)
