Swiss Prime Site Ag

Welcome to the Swiss Prime Sight full year 2025 earnings conference. The presentation will be followed by a Q&A session. For those of you who have joined the Zoom webinar, you can use the raise hand function at the bottom of your Zoom screen at any time to join the queue to ask a question, and you will be called upon during the Q&A session. I will now hand you over to your host, Marcel Kouker.

Das war eine etwas kürzere Einführung als geplant hier. Herzlich willkommen hier im Saal. Very well welcome to everyone on the screens. Welcome to Swiss Primeside here on the 34th floor of Primetower in the heart of Zurich. It's a great pleasure to have you here. I'm here joined by Anastasios Csok today. He's the deputy CEO of our group and also the CEO of Swiss Primeside Solutions. And he will talk later a little bit more about our asset management operations. Before we start with the numbers and the actual result, let us step back a little bit and look at where we stand today. Over the last couple of years, we have been building on our Swiss real estate platform with the two legs of our own property portfolio and the asset management. And today, we stand here very proud of what our platform has become. Over the past years, we have built not only this platform, but we have built it in a very synergetic way that performs very strongly, and we'll show you today why this is the case and where this comes from. And more importantly, it also performs very synergetically across the cycle, building on the resilient Swiss economy. In today's cycle, we benefit from very supportive financial conditions. with record inflows of new capital. We have seen this in particular in our asset management with more than 1 billion new money and a record high of 14.3 billion in assets. driven by a very, very strong organic growth. We have also seen that in terms of the transactions that we could do, all the acquisitions that we could do, in particular in the asset management in the residential area, where we have a structural undersupply here in Switzerland, like in many other countries as well. On the other side, and managing through the cycles with our own property portfolio, we have delivered development over the last couple of years, more than 40 million in top line. And we have hence been a... very important part of building high quality buildings here in Switzerland for the commercial sector. Again, this year, we have shown that also in a cycle with low rates and less inflation, we can drive like-for-like growth with a very, very strong 2% growth for this year. And hence, our platform is a true flywheel. creating momentum that reinforces itself and together and building on these strong foundations, we will continue to thrive in the Swiss economy. And with that more strategic outlook, we want to go into kind of the key elements that we want to present today. You see here all the details, but I want to summarize that into four key takeaways that I think you should remember once you leave this room. The first one is we are growing. We are growing with a 2% like for like growth in our own portfolio. We have reduced our vacancy to 3.7%, a record low for Swiss Prime side, showing how strong we perform in all of our properties. And we're also growing in the asset management sector. You've seen the 18% top line growth last year. So very strong momentum, all organic and fueled by the strong capital markets that we see. That will bring me to the second point. We are attracting new capital. We have done a capital increase for Swiss Prime side in spring of last year, 300 million, which are fully invested today. We have been able to attract one billion in new money, an absolute record high for Swiss Prime Sight Solutions in our asset management division, and we have been able to apply that in very attractive acquisitions throughout the two segments. That brings me to the third one. We are investing. We have truly built a platform that has access to the most attractive transactions in Switzerland, having done more than 550 million in acquisitions for our own portfolio. And in addition to that, 1.7 billion in acquisitions and transactions in the asset management sector, getting really access to the right transactions, even in a market that is very flourishing. And fourth key takeaway, we are becoming more profitable. And you see that in a 3% up from a comparable EBITDA up to 408 million for that year. We see it in a more than 30% growth in the profit for Swiss Prime Sight Solutions. And you see it also in the dividend proposal that we make, which is 5 cents higher than in the previous year. So we're also sharing that benefit with our shareholders. Going from these key highlights, let me step back a little bit and look at the key elements here, how that performs in key financial figures. You've seen that in the press release and in our presentation, we have a slight decrease in the rental income only due to the fact that Yelmoli building went offline. together with a couple of other buildings where we lost about 14 million in top line last year. On a like for like basis, as I mentioned before, we have seen a very strong increase of 2%. In the asset management business, as I mentioned before, a record level of almost 85 million in top line, 18% growth over last year, mostly driven by the organic growth and the money that we could attract to a small degree about one tenth of that driven by the full year consolidation of Fundamenta, which we acquired in April of 2024. EBITDA consolidated on a like for like basis 3.4%, as I mentioned before in absolute numbers minus 1.2, but given the lower interest in particular, as well as lower taxes that translates into a profit before revaluation and sales of 1.3% to an also attractive level of almost 320 million Swiss francs. On a per share basis, that translates into 422 unchanged over the last year in terms of FFO1 per share, FFA2 per share, we see a grease of 6% to 4.17 and an APRA NTA that is up 2% to 101.40, underlying the very attractive real estate that we have, which also have seen a very positive revaluation last year. On what type of market do we achieve these results? And I think I want to leave you with four key elements here. The first one is on the transactions. We have seen last year a very high level of activity on the base of a very broad institutional buyer space. This has been not only the case in residential, but also in the commercial. We see yield compression in many of these respects, and we see in particular also an increasing number of larger assets being on the market, which is attractive for us as a commercial player with our own portfolio. second key takeaway that i want to leave you with is we have a continued polarization in the demand on the letting side we see a huge demand for for additional space in the core segments where we are which means in the inner cities this is where life is where people like to be where people like to work and And that is contrasted by probably significantly less activity a little bit further outside, which is becoming more challenging what we see. The third key takeaway is on the valuations. We've seen for ourselves an increase in valuation of 1.7%, roughly translated into some $220 million. And we see that across the board with this hands rates coming a little bit lower, but also the effects that we see from the positive growth in rental income on a like for like basis, which has an impact obviously on the valuations. In terms of our own book, we have been able to do our sales with roughly 5% profit, which is exactly where you want to be, being at the market, but obviously on the conservative side in terms of the valuation. And finally, fund flows. We've seen a record year for ourselves. I mentioned that before. Altogether, 1.3 billion across our platform, 300 million for our own capital increase in February, and roughly 1 billion in 2020. new assets for the asset management. Pension flows is an important element for that. We see here large inflows from the pension flows, and we also see higher allocations to real estate, which is supporting the entire market. Now, for the next couple of minutes, let me dive a little bit deeper into the P&L and the individual results that we have from a finance perspective. Let me start with the top line and with the resilient rental income and the strong asset management growth that I've mentioned before. We've seen real estate income from rental decrease by 1.4%. As I mentioned before, that was all due to the fact that Yelmoli went offline together with Fra Münster Post, had an impact of roughly 14 million, and you see that we were able to compensate most of that with our own growth, like for like growth, as well as the acquisitions to a smaller extent. Second element I wanted to mention is the asset management, 18% plus over the last year, record level of 84 million roughly in top line. This is all due to the further increase of the funding flows that we have seen and then hence the transaction that we could do following that and to a very small degree also on the full-time consolidation of the fundamental for the full year as I mentioned before. That is contrasted, obviously, by the last elements that we see from our focus on the pure real estate platform with now income from retail only at 10 million, which is the last two months that we've seen for Jelmoli, and also the other income coming down significantly, which was also related to the retail business. Hence, overall, about 17% lower total operating income. But what is more important to me, because this is all what we wanted to do with the focus on our real estate business on a comparable basis, hence excluding the effects that you have through the closing of Kilmoly, we have been able to grow 2.6% over the entire platform to a level of 540 million roughly Swiss francs for the last year. If you flip the site and look at our cost base, we see a similar positive picture with a huge drop in the operating expense. However, the majority of that is due to the fact that we discontinued the operations of our department store. And hence, again, I would ask you to look at the lowest number here, so at the bottom here, where we have been on a comparable basis, hence, excluding all the effects that we have from closing the department store a lower call space of 2.8% showing how much we can drive synergies across the platform. One of the key elements for that will be the real estate cost. You've seen before the absolute number in terms of rental income reduced by roughly 1.4%. We have been able to decrease the cost of real estate of 5.4%. and that shows you know we've become much more efficient here and this focus on the buildings in these core locations on the slightly larger buildings that we have been pursuing over the last couple of years has also a positive effect here in terms of the efficiency and the cost and the cost ratio now if you bring this together Then we see that the positive revaluations that I've mentioned before, I will go into details a little bit later on this, where this came from. Then coupled also with the sales from properties where we had a gain of roughly 5% over the last value, leaving us with an EBITDA in absolute terms of roughly unchanged 410 million Swiss francs. But again, for me, the more important takeaway here is the number at the bottom. So on a comparable basis, so excluding kind of the last time effect that we have from our Jamoli operations, we've seen a comparable increase of the EBITDA of 3.4%. And hence, you know, again, amplifying what I've mentioned before here, the strength of the platform and how we can become more efficient going forward. Now if you go further down from EBITDA on an FFO basis and the APRA NTA here, we keep an unchanged funds from operations one from per share of 422. In absolute numbers you see that we see an increase of 3.2% here, but given the higher number of shares this translates then in an unchanged number. showing that we have been adding value to our capital increase already in day one of the capital being employed. And this will only become better over the next years. On the intrinsic value per share, here you see a 2% increase comes to a large degree from the revaluation effect that we have seen and a slight reduction in leverage, which I'll mention in a minute. So what I want to do now is provide you a little bit more details on the two key drivers on the top line and then a couple of pages on the balance sheet as well. Let's start with the top line and obviously the most important element is our rental income. You see here the composition on how we end up with the roughly 455 million. We had seen last year in 2024 really strong sales with a strong tail end here. We sold in 2024 330 million, really focusing our portfolio on our key locations and on the key cities in Switzerland. Now, this obviously had an impact then in 2025 in terms of the top line. And you've seen from that sales, we also sold about 15.7 million in top line. Then what is very important to us and the key focus is what can we do with our existing portfolio? You see that here in blue with an increase of roughly 8 million and that translates and you see this here in more detail in the 2% like for like growth. with roughly 1.6% coming from real like-for-like growth, speaking from really changes in the underlying rent and in the rental contracts that we could actually sign, coupled together with a further vacancy reduction, which had an impact on like-for-like of 0.3%. A small number still comes from indexation, 0.4%. And I would expect that to stay at that level, given that we have pretty much zero inflation here in Switzerland, or even come down a little bit further. Then the redevelopments, I mentioned that before, this is mostly Gjelmoly, but also some elements of Fra Münsterpost. These are the buildings that went offline, temporarily offline. I think that's an important addition to that. We will renovate them and I'll provide you more details on that when they will go online again in just a minute. um the acquisitions that we did um uh the 550 million that we that we acquired had not yet the full effect given that a large part of it was only closed in december and the rest april and august hence you will see much more impact of that going forward in 2025 we had an impact of roughly 5 million coming from that. And then we still have the completion of new builds, which is roughly 9 million, which to a large degree translates to Alto Bon Rouge in Geneva, as well as the buildings in JET in Schlieren, as well as in Bern 131. A word on the asset management side as well. How do the 18% realize that we've seen in top line growth last year? You see here, the management fees have been growing by roughly 15%. So these are the underlying fees that is a very recurring character. The same recurring character is on the construction development side. Slight reduction given the fact that last year we completed a little bit less construction than we did before. And then obviously on the non-recurring side, on the transaction side, that is the mirror of the high net new money that we could attract of the 1 billion, which were invested in about 120 transactions. As I mentioned before, 1.7 billion roughly in transaction volume that we did in the asset management. An important figure for us is we want to build here a stable asset management operation that mirrors kind of the stability that we have on the real estate side. And hence, an important number for us is that we remain at roughly two-thirds of recurring fees. And that was also the case in last year, despite the very positive market at 66% recurring income. What you can also see here in the numbers is the cost base has been stable or even decreasing slightly. You see that in particular here on the personnel cost, which are the most important cost base. These are the elements that we still can benefit from the integration of Fundamenta. We mentioned back then that we expect some 8 million in synergies and we have now been able to fully realize those. And you see that in the number here that EBTA grew by significantly more than the top line, 31%, exemplifying here the stability and in particular also the scale effects that we have. that translates into an ebitda margin which we believe is very attractive of about 66 percent so about two-thirds percent and and hence you know shows the power again of our platform and doing things together two words um on the balance sheet um The first one is obviously on our real estate portfolio, which has reached new heights with about 13.9 billion Swiss francs, almost approaching the 14 billion Swiss franc mark. We started with roughly 13 billion. We talked about the sales. I will provide some more details on that just in a minute of 130 million. Then the 550 million acquisitions that I mentioned before. Total investments in our developments was 222 with a strong focus obviously on Jont and Jelmoli. And then the valuation result that we mentioned before of the 1.8% roughly, providing us with a total of the $13.9 billion. Maybe one word on the revaluation. We've seen, given the strength of the Swiss market, a slight reduction in discount factor. In real terms, about two bips. In absolute terms, a little bit more because our evaluators also reduced the expectations on the inflation by 25 bips. The latter has... practically no impact on us, given that we have a very large share of our property being fully indexed. Hence, we can pass on any indexation and any inflation. The latter one does have an impact, and hence you see it's probably about 50-50 in terms of the revaluation result, in terms of what stems from the discount factor reduction and what stems from the like-for-like growth and exceeding here the expectations our evaluators had in terms of the closings of new contracts. And then the last element on the balance sheet is our financing, two pages on that. We have been able for the last year to place almost 800 million in new financings and for us, as a very important highlight, we were able to access the Eurobond market for the first time. We placed in September a 500 million Eurobond at a very attractive spread, roughly mimicking the spreads that we could reach here in Switzerland. What was very supportive for that placement and made us really feel good about this market is we were able to attract 4.3 billion in demand at that interest rates that we had. So we had an oversubscription of about eight times, which is very high even for the Euro market and shows just the incredible strength of our name and of our platform in Switzerland, but also abroad. Despite the fact that we have a large degree of our financing with fixed interest rate, you see that here at 86%, we have been able to reduce the average interest rate significantly from about 1.1% that we had in the previous year to 0.94% if we are precise. And that is, we believe, very attractive as well. Overall, given the financing level that we have here, that translates into an LTV net for the real estate segment of 38.1%, which is a slight reduction of 0.2 percentage points over the last year. What we continue is that we have a very broad set of potential financing opportunities and that Eurobond only added to that to make sure that in any position we are always able to refinance ourselves. You see that here about 50% is financed through unsecured bonds. 40% of that is roughly in the Swiss market, 10% is in the Euro market. We have still access to the convertible bond markets. We have very good partnerships with our core banks, 13 banks in Switzerland for the unsecured loans. And we continue to have the secured loans with the insurance companies of about 11% of our overall portfolio. moody's rating a free stable and that provides us with this access that we just mentioned before in terms of the Liquidity, we have a very high liquidity reserve of 1.1 billion roughly. This is fully committed, so we can access it anytime. And that provides us with enough liquidity over the next couple of years. So we don't have to go to the market, but we will, of course, access the market in order to stay an active player here. That's for the numbers and for the financial numbers. Let me spend a couple of minutes now to dive a little bit into more details of our portfolio before I hand over then to Anastasios to provide some more details on the asset management side. Let's start with the overview and given the acquisitions that we did this year as well as the disposals, we have strengthened further our position in our core market. So we have now close to 60% of our portfolio in central Zurich area, about 20% in the Lake Geneva area with the two strong hubs in Geneva itself as well as in Lausanne for us, and about 12% in Basel in the northwestern part. We have further reduced the number of properties despite the acquisitions that we did. And we are currently at 132 properties, which relates into a average size of our properties of around 100 million, which we feel very comfortable with going forward. And we already talked about the property portfolio of close to 14 billion. In terms of the use, we have further strengthened our office segment, which we strongly believe in, in the core markets that I mentioned before, and in the prime locations that I mentioned before, with close to 50% currently, 20% retail, and then the rest is spread between infrastructure, logistics, which also includes labs for us, hotel, gastronomy, and the slightly reduced share of assisted living, which are mostly the tertianums that we have. We're still very proud of the diversification of our tenant base. We have about 2,000 tenants with 50% spread among the top 30 tenants. Our three largest tenants still remain the same with Tertianum slightly reduced at a little bit over 5%. Swisscom at roughly 5% and Globus slightly reduced also at close to 5%. I'll talk about Globus in just a minute. um where you see this beautifully the focus that we have taken over the last couple of years in this matrix which is provided by our evaluators wisdom partner where we have over the last couple of years if you compare this to four or five years ago really been able to put a really really strong focus more than 99 is in these highest brackets in terms of quality of the locations And close to 90% is also in the highest bracket in terms of quality of the building. And that has been a significant shift and the basis for the strong like for like growth that we could achieve. i'll show you some pictures on the acquisition so let's skip that um but you also see where we sold properties uh this is still uh not in the core elements that i mentioned before so we sold properties in our abl augst books and broke with a strong element on two on two segments the first one was retail where we're still reducing in particular in these non-core locations And the second one was developments where we felt that the best one is residential going forward. So what we typically do is in order to capture the value is we develop it up to the point where it has a building permit and then sell it to somebody who has a core focus on residential. now talking about the acquisition and the fantastic buildings that we were able to acquire and fantastically enough it starts here from the left to the right not only in terms of location but also in terms of timing we started the year in april with the acquisition of the plus design in geneva From SGS, just last week, SGS opened its new headquarters in Bar, which has been beautifully renovated in our building. And hence, you know, this was a truly... benefit transaction on both sides. We were able to acquire this beautiful building you see with unobstructed views to the Lake of Geneva and SPS was able to find a new headquarters in the Canton of Zug as they wanted. We are currently in very advanced discussion with tenants, focuses on a single tenant again, which we hope to be able to close in the next couple of months. But we also have alternative discussions on a multi-tenant solution. Typically, we would look at two tenants, which should move in later this year. Then on PRI in Lausanne, key tenants here, SAP, ROAC, really strong technology tenants. We have long contracts of almost 20 years. This is a brand new building to the highest elements, not only in terms of architecture, but also in terms of fit out and sustainability. We are right at the very busy new station of Pri and also right at the new station of the tramway, which will open later this year. Zurich West, we have a little bit too much fog, otherwise you could see it from here. The headquarters of the Swiss Stock Exchange just down here. The road key tenant is the Swiss Stock Exchange. It's currently a single tenant building, but already built in a way for a multi-tenant. so that we have full flexibility going forward and then the last one which we could close as part of an asset swap was in Bahnhofstrasse at Zurich a beautiful building and we being the absolute best owner given that this was originally one building where we owned the first part already this is where the ones that know Bahnhofstrasse where the swatch store is in And now we added kind of the second part of that building, which provides us with many more opportunities going forward in terms of efficiency and efficient use and space that we can offer fully led with key tenant rituals. If you calculate all this and then it includes kind of the asset swap that we did in Bahnhofstrasse, you see a net yield of roughly 3.7%, which we believe is very attractive given the quality of the buildings and obviously is highly accretive given where our actual yield is. Hence, you know, very attractive acquisitions that we could do over the last year. One word on vacancy. You see here, if you just look at the graph, lowest ever, 3.7%. We could in particular sign a couple of new leases like SGS, like the , And a couple of major extensions, EY just down here as one of our key tenants here on the Prime Tower campus, but also with the Canton of Zurich, an attractive building in Erlikon, as well as the extension of Globus. I'll mention that a little bit more detail in just a minute. The 3.7% have an underlying 3.2%, which is operational vacancy, and then an 0.5% for strategic development. What does that mean? Those are floor spaces that we do not actively market currently because we start to empty a building so that we can do a future redevelopment. So with an underlying, say, vacancy of 3.2%, which is also a record low in the history of Swiss Primeside. One word on WALT, you see here a very even spread of the WALT, pretty much everything is 10%. That has a significant change over the last period. We increased our average WALT by almost a half a year to 5.3 years. mostly driven by the extensions of EY that we mentioned before and Globus. On Globus, I think we mentioned that during the half year already, we have a staggered extension agreement where we have seven years for Lucerne, eight years for Lausanne, and then the 10 years for Geneva, which then also flattens kind of the profile going outwards. Then a question that usually comes, are you nervous about the 9% that is on the short term? I say absolutely not. On the opposite, I look very much forward to that. We have been in good and advanced discussions with the majority of the tenants in here, and the reason why I think this is positive is because in the vast majority of the cases, we see here a very positive response. potential for higher rents when we entered kind of the next agreement phase. Hence, no worries on that side from our perspective. Now let me spend a couple of minutes on our three ongoing development projects, obviously the most important one being Gelmoli. Just a little bit what's the current status here. We have started construction in April, pretty much right after we closed the department store operations, end of February. Obviously, the first stage in the construction is that you start to demolish, kind of lay open the underground structure, and that is pretty much finished by now. Part of that was also a removal of hazardous material, just to provide you a little bit of an overview. impression of the complexity of the building. The building is not actually one building, but it's four main buildings and 11 buildings. If you look also at the kind of connecting buildings together, now everything is open. And we take now the opportunity over the next two, two and a half years to really bring this entire building kind of to the next century, where we will not only convert it into the office part in the upper floors, but also really, you know, address the structural elements and really, you know, catapult it into a new area. Overall investment is gonna be roughly 210 million. We can be pretty sure on that by now because we have agreed on a general contract in September and we expect a staggered completion starting in summer, 2028. On the rental side, obviously we still have roughly 50% pre-let. We are in very advanced discussions with some tenants. These are really top tier tenants. We also have signed LOIs for two floors of the remaining office floors and we see really good demand here for those. As I mentioned before, eight summer of 28 staggered completion date, in particular for the offices. Hence, we are a little bit early for the real marketing efforts. And you see this year, the active marketing will start now in summer or later after the summer of this year. But kind of the pre-marketing, the effects, we are already very positive on that one. Second one, the snapshot is Jons Campus. Also here we have just signed a contract with a general contractor. Investment volume remains at 150 million, yielding from that about 8 million in additional top line. So you see it's also very attractive yield on cost from this project. We have been able to sign a number of contracts already for that one that I really like is Hard from to the back foundation Which provides a real new hub here also for inclusion the Tobin and boy So we continue kind of the tradition of the building of brewing water Vickers and now also beer in in that area and a number of other Signatures are pending and hence we're very happy in terms of how the marketing works. Also here we have a staggered completion as of 2028. We have currently completed the garage, so the underground parking, and now we start building the Yon 3 construction. This is the main kind of new building. It's about 85% of the entire new development. um uh with the yawned two then following later on once we have also reached um here our target level in terms of uh pre-letting last snapshot from munster post uh the building in the middle of Zurich that everyone knows currently. We are doing a refurbishing here, bringing it also into the next century of about 30 million. Completed here will be summer of next year. will in particular have a focus on all the sustainability elements, on the heating elements, on the insulation elements, et cetera, with a sustainability certificate that we expect of preeminent use of very good. We are in advanced discussions with a number of tenants of about two thirds of the floor space and expect that by the time this is completed, we should also have 80% plus let as usual with our buildings that is on track for the completion as I mentioned here before. Two pages on sustainability, which remains a focus of ours, and I want to mention here four elements that are important to us and to me personally. The first one is we continue with our certification process. We have pretty much everything certified in our portfolio that is certifiable, so excluding some parking spaces, et cetera. We have now 40% of our top tier buildings that are eligible for our green finance framework. And that is only buildings that have a good or very good or platinum rating. We're working on that, that this will continue and the certification gives us a very strong indication on what we need to work on. And that's why this is attractive for us, not only to provide you as investors with the full transparency, but also for us to provide us with an additional element of inputs on what we need to work on. A real key element that we achieved last year, and I want to jump here one page, is another 10% year-on-year advancement in terms of the CO2 reduction path. You can see here, this is our linear target that we had to 2040 CO2 neutrality. We are well on track here. We are in fact advanced on track and we could add here another year with a huge milestone with a further 10% reduction. Weather adjusted by the way, which is important because we do not benefit from a say mild winter, but we adjust for that so that it's really comparable. Some of the key elements that we do here is obviously heating replacements and energy modernization. We also continue to work on the green leases here, which means we work together with our tenants in order to make sure that not only we reduce our energy consumption, but also our tenants work together with us. sign these in green leases. We work on the improvement of the energy mix and obviously do wherever we can, district heating mix, et cetera. And then obviously the building shelves, which is an important element, as I mentioned before with for example, or also global where we focus on that as well in the renovation path. Let me go back. on two other elements which is the circular economy element which is a key element as well for us in terms of our focus area we have completed the burn 131 project which is a true lighthouse in that respect that you see here the embodied emissions is 7.3 kilograms. The ambitions as per the circular economy charter is close to 12 kilos. So we have been significantly below the already super low kind of ambition that we have taken. for our charter. How did we do that? Well, it's a mostly wooden construction with some concrete to reinforce it. We focused here on Swiss wood. So it's not wood from anywhere, but it's Swiss wood. And then obviously, the entire building is covered with photovoltaic cells so that the building actually produces more energy than what it consumes. And finally, because we want to have this really all encompassing, we have the green finance framework where we refinanced almost 800 million last year under the green finance framework. And for that, you know, we build on what I mentioned before, our certificates in terms of good and very good buildings that can only be eligible to the green finance framework.

so with this i would hand over to anastasius for some additional words on the asset management part thank you marcel dear ladies and gentlemen a warm welcome from my side the next few minutes i will give you some details about this is prime side solution results 2025 As Marcel Kucher mentioned before, we grew 2025 with 1 billion assets under management. We raised 1 billion Swiss franc new money. This is more than 2023 and 2024 together. Our real estate transaction volume 2025 was 1.75 billion Swiss francs. from all these deals were 30% off market deals. So we have really good networks in Switzerland. Now I will show you the three sub pillars of the asset management part. On the left hand side, you can see our fund management. In this fund management, we raised 430 million Swiss francs new equity in 2025. Another highlight was our IPO with investment fund commercial in December 2025 with a premium from 10%. In the middle, you can see the sub-pillar wealth management or asset management. the products there, the Investment Foundation SPA or the Fundamento Investment Foundation. In this part, we raised 590 million Swiss francs new equity. And another highlight in this part was we extended the contract with Fundamento Investment Foundation by three years to 2029. On the right hand side, you can see our real estate advisory sub-pillar. In this sub-pillar, we gained a new mandate by around about 400 million. This PrimeSight solutions are the biggest independent real estate asset manager in Switzerland. Only banks and insurance companies in Switzerland are larger than us. but they have an own book of equity. We do not have that. We have more than 2,700 clients. 600 clients of these 2,700 are pension funds. Our main focus in our products to invest 60% is living housing. The last slide from my side and the key takeaways for you. The pension fund system in Switzerland are very strong. They have to invest 1770 billion Swiss francs every year. Roundabout 23% goes in real estate, so roundabout four or five billion Swiss francs every year. Our market share is 12 to 15%, so we think that we can raise every year 600 to 700 million new equity. We have a net immigration in Switzerland by around about 100,000 people, and the interest rates are low or going down. So you can see The business case for Swiss Crimeside Solutions is really stable. As Marcel Kuchen mentioned before, our recurring fees are 65% the last year, and we think it will go on with this number. For growth to 60 billion assets under management, as we have as target to 2027, we can benefit from the economy of scale again. Thank you for your attention, and now I hand back to Marcel.

Thanks, Anastasios. So there's only one thing to say for me. What is the outlook? So we expect the attractive Swiss market to continue and hence we want to provide the guidance for next year for an FFO that further improves to 425 to 430 on a per share basis. We will do that with a very disciplined financing policy and remain with our LTV below 39%. We do see further potential to improve our vacancy and hence guide that we will be lower than this year, so lower than the 3.7%. And as Anastasios just mentioned, we see continued growth opportunities for Swiss prime side solutions with an additional addition of 1 billion AUM also for 2026. Hence, a positive outlook. And with that, that was it from our side. And we would hand over to questions. I think we start here. Who would have thought? We start here in the room and then hand over to potential questions that we have on our stream. We do this in English today because on the stream we have many people that are English speaking and we realized that the simultaneous translation was not always that easy. If you feel more comfortable in asking a question in German, that's no problem. Just please do that and I will try to translate as good as I can. So, where do we start with you? Perfect, Matteo.

Thank you very much, Matteo. I have a question on slide 22 regarding the active portfolio management. Could you tell us how large is the amount that you would still say capital recycling is possible? And why did you tell in December that you will scale back the sales? Has it to do with the market environment or did not the buyer come as you wished for?

Yeah. All right. Happy to do that. Let's start with the second one. It had nothing to do with the market. I mean, the market is super strong, and we've seen that with the 5% profit that we made. We will also this year see a number of additional transactions that we partly signed already last year. That is, in particular, the second half of the asset swap. which will only happen in 2026 because these are in cantons where the communities have a first right of refusal. So there's a gap between kind of when you can close that. So we expect that to close somewhere in April or something like that. for the second part. So no, it has absolutely nothing to do with the market. For us, it was important that we provide transparency, that we will keep a number of the buildings in our portfolio as we have now with the capital increase, more equity and hence a little bit more flexibility. And your first question was around whether we can further kind of suppress that in the top quadrant.

Was that the question?

The number of buildings?

And in francs.

Okay. Well, for this year, my expectation will be that we will continue to sell about 250 million worth of buildings. As I mentioned before, PAR was already signed last year. So about 150 million was already signed last year, which will now be closed in 2026. And we have a number of additional buildings that we have. that we have in the pipeline. I think the focus of capital recycling shifts a little bit into more say a regular portfolio optimization. I think with what we have done over the last five years, we have really concentrated our portfolio in where we want it to be. But given the size of our portfolio, we always see opportunities where we believe we are a better owner than somebody else or within our portfolio where we see another owner be the better owner than us. That has a lot to do also with repositioning of buildings. I mentioned that before, we always have a look also with our commercial buildings, whether they would be suited for residential. And if that is the case, then we would develop it up to a certain level, typically building permit and cost certainty with a contractor general, and then sell it on the market.

One more question on this asset swap of the Bahnhofstraße. What's the net yield of the building?

In Bonn of Doss, I think it's 2.7% roughly.

Thank you. Yeah. Ken.

Thank you very much, Ken Kagerer, ZKW. My first question is to Anastasios Chopp. And Okay, whilst I see the fact that it's very easy or it seems to be very easy to raise cash in the current environment, I'm a bit more worried about the way how to deploy this cash into 2026, especially when we know that more than $9 billion were raised last year and you plan to raise another billion and the others also seem to be also very active. So now comes the question, how do you want to deploy the money with... Good acquisitions on the direct market at the correct yield without diluting either the payout ratio or the quality of your existing products under management.

Thank you for your question. No, we have a good pipeline for all products. We have some transactions done in January. Good transaction and our pipeline are full for the next four or five months. And we are sure we can hold the quality and the performance in the product.

thank you just a small add-on for you the fundamental contract was extended was just mentioned can I expect that the margins or the cost is stayed flat yeah okay thank you the next question is on Yelmoli I've just checked the full year presentation 22 and the capital markets day presentation 23 and in 22 it was mentioned that the renovation cost should be above 100 million At the capital market state, it was mentioned that the renovation cost should be 130 million, and when I remember correctly, René was very firm that this is a number he can stick to, and now I've read that we see 210 million. Now comes the question. First, is the rooftop included or not already? And secondly, what has happened with the increase in the cost and what has happened, especially to the yield expectation on the construction cost?

Yep, happy to do that. Yes, this is the entire building, including the roof. We will have a restaurant on the roof. We will have spaces on the roof for our office tenants that they can use, and that is part of this cost. The entire roof, but that was always the case, will only be able to use in... 33 or something like that, because we will have until then, until we can connect to a cool city. And we up until then need part of the roof for the coolers, for the cooling system. But that was always the case. That is nothing new. In terms of the cost that we have, I think now we can be firm on that. We signed a contract. We have obviously built back everything that is internally, so we're now back to the bone and the structure of the building. And in the course of doing so, we decided that in part it makes sense to do a little bit more. That has elements in the atrium where we believe we can add additional floor space and make existing floor space more attractive and bringing more light in it. but that's also part of where we will further support the structural elements. Given the increase in rent that we see and where we also are with yellow eyes that we signed, we see purely on a yield on cost about 4%. And if you add to that the losses that Yelmoli did over the last couple of years, you'd be more in an area of... So both numbers, even just the 4%, we do believe in a location like Bahnhofstrasse is super attractive. And hence, yes, this is going to be a very valuable addition to our portfolio going forward.

Thank you very much. And this brings me to my third and last question. What would need to happen for you to do another capital increase in 2026?

Well, you know, for us, the most important thing is that it needs to be accretive and it should be accretive, you know, quickly, not in five years time and with a lot of hope. And the last year capital increase, I think, was at an attractive timing because we've seen end of 24 falling interest rates. And hence, we increased our capital in a phase of falling interest rates where we still could benefit from attractive acquisitions as these falling interest rates were not yet fully established. reflected in the prices. And I do believe you need to see these opportunities that allow us to grow our portfolio in an accretive way that will make us then to do another capital increase. And as soon as we see those opportunities, I think we've shown that we are quick to act on that.

And do you see any opportunities now?

that we'll answer once we see them.

Yep. Holger Frisch, ZKB. Question. On the half year presentation, you presented a slide with the investment volume for SPS of about 1.3 billion, broken down in 200 million invested, 100 million committed and 1 billion open. Could you provide us with an update on the current number and the breakdown?

Yeah, the number has not significantly changed. We thought it is more useful to talk about the projects that we're currently working on. As you can see, these are roughly the numbers in terms of commitment, so the 200 million, the 150 million, the 30 million. together 390 million of which about 70 to 80 million is already you know built so we have a slight increase in terms of the of the commitment obviously because now we signed the general contracts on JOND as well as as well as JLMOLI The overall number has not significantly changed, but this includes conversions that will only take place in a number of years. Most prominently, if you look at Geneva, now we extended the contract with Globus by 10 years, so that means the conversion project that we developed here. We still want to do it, but realistically we will only do it, you know, in 10 years. Hence, you know, some of the elements moved a little bit further out. Thank you.

Then the second question would be on the maturity of the financial liabilities, which went down to 3.9 years, which is the lowest for the last 10 years, I think. So do you feel comfortable with that level now, or do you have any plans to increase the maturity? And then maybe on the maturing bond of 350 million in May, what are your refinancing discussions?

Okay, a number of elements on that. Why is the majority coming down a little bit? This has mostly to do with the unsecured loan that we have with the 13 Swiss francs. And that contract still runs about four years, part of it five years, and hence it is too early now to renegotiate that. We will do that, say, two years before it actually matures roughly. Hence, you will probably see that it comes down a little bit further. Does that worry us? No, because it's a clear maturity pipeline that we have here. We have built up now many opportunities on how we can refinance, not the least the one in the Euro market where we have seen very attractive opportunities going forward. All the rest is roughly in the same range. You've seen the Euro financing where we did roughly six years. You've also seen the one that we did in January of last year at roughly the same rate. With the upcoming majority, we already did the floater end of last year, which was part of that refinancing. The rest, you see, we have plenty of line that we could use. Obviously, we also reserve the right to do an additional bond refinancing, where we see very attractive conditions currently.

Thank you. And one last question on the vault of 5.3 years now. Could you break down the vault for the different types of use like office and retail and so on?

I don't have it here by heart. We can provide it later on. But my gut feeling is, given that retail is only 20% by now of our portfolio, it should not have a significant difference. The large part of our retail are co-op stores and globals, of course, now. And hence, you know, we've seen here just the extension. Hence, it should be roughly in line. But if you want a precise number, I would have to check. I don't have that up by heart.

A quick question on Yemoli at the Capital Markets Day in Geneva this spring. I thought the beginning of going live again is in 2028 at the beginning. Now you said at mid of 2028. Why is there this delay?

with what I mentioned before, where we will probably do a little bit more than we originally envisioned, because we believe this is beneficial to the building and the rental income that we can generate, we need to build that. And hence, the current plan, and we are very confident now that we can stick to this plan given that construction is now in full swing. And in particular, the building is empty now. So if you walk through the building currently, you see all the walls are dismantled. You see all the structural elements. So we are really very much focused now to rebuild the building, as I mentioned before.

Since the mic is here, Tomas Alberto, UBS. A question on reversion. Since inflation is as low as it is, you know, focus will be on reversion. So could you update what the reversion potential is for the portfolio in general and then specifically also for these new couple of acquisitions that you made?

Yeah. On average, I think the simple answer is it's about 10% of the reversionary potential. We do have about five years walled, as we've seen before. We have probably an implicit wall, which is a little bit longer, given that some of our tenants still have options where they can extend at the same conditions. So taking the 10% and divide it by maybe six or something like that, that yields you around the 1.4%, which we have now consistently been delivering in terms of real conversion. We're working hard on that. We're doing all sorts of things in terms of how we do community management, what services we provide to our tenants. If you look here in the prime tower, if you've been to the elevator, you see all sorts of services on the screens that we have. We have cars here where pretty much the entire prime tower campus takes part of it. We have bikes and all that make tenants more sticky. because they really like it and that is helpful for us going forward. So we try obviously to exceed the expectations that the wisdom partner has and you see that in the revaluation. I mentioned before roughly 50% comes from the underlying higher contracts that we could close and we expect and we work hard on that. You will continue to see that going forward.

And for the new properties?

For the new properties, some of them come with a long contract. I mentioned Lausanne with a long contract in terms of... which is the one that we are re-letting. We are very positive that it's going to be in the mid double digit numbers in terms of what we undersigned and where we will end up now in terms of reversionary potential. We see that this attractive space with a beautiful building, old one and new one with an unobstructed view to Lake Geneva is really attractive in the market. And hence, we're positive on the revaluation that we get there.

So a double-digit percent increase, or what's that double-digit? Okay, yeah. And then on the CFO transition, you wouldn't be the only one.

Okay, key message is I will not do a double job. So that is the key message. We want to take this very seriously. We want to do a thorough evaluation. If you talk to headhunters, that takes four to six months and that time span will be, you know, do you roughly say in March and we're working towards that. Thanks. Andrea, just behind you.

I have a question about Frau Münsterpost. Are you just redoing the offices on top?

Yes, Lidl is still open. Lidl remains open and is open. but we're doing the entire office part and and the key element here is on the on the heating system on the cooling system etc where we will go full green insulation is part of it with the windows obviously this is a protected building and we want to transform it in a way so that it's fit for the next 50 years 50 years plus we've seen very good demand So far, and, you know, really top tier tenants, where we in the progress in the process here of hopefully signing them up, so that they will move in when it's ready in, you know, one and a half years roughly.

Yep.

It's a recurring question that always comes up, but is there any update on Müllerstrasse for Google tenant?

Look, Google made an announcement. It was quite prominent in the newspaper. I think it was October last year where they kind of committed to Zurich. All we hear is that they're no further reducing the workforce. On the contrary, it seems, at least from the outside, that they're transferring some of the development on their AI engine here to Zurich. In that announcement, it was also said by Google that Muleft AUS is a key element of their development. Hence, we have no indications whatsoever from Google that they don't want to keep it. And that's the current update.

Thanks. Just one follow-up on the double-digit percent increase for Plus, as Alpi mentioned before. That's including CapEx or just as it is?

The CapEx is not going to be huge because the majority of the CapEx that we're going to do that is tenant-fit-out. Obviously you need to do some capex if we separate it and have a multi-tenant, but that should also translate in higher per square meter prices. So it's roughly the same, but we are not gonna invest there hundreds of million. This building is a very good shape. It has a modern heating system. It has modern insulation system. And the capex that needs to be done is mostly around fit out, which will be done in conjunction with the tenure. All right, then let's switch to virtual. We can come back here to the room if there are more questions. Are there any questions from the website?

Thank you. We will now begin the virtual portion of the Q&A. If you would like to ask a question from the Zoom webinar, please use the raise hand function, which can be found at the bottom of your Zoom screen. Once called upon, please unmute your audio and ask your question. Our first question comes from Anna Escalante with Morgan Stanley. You may now unmute your line and ask your question.

Hello, good morning. I have a couple of questions, please. The first one is on your vacancy guidance. So, as you said, you are in 2025 in record lows and you said that you see further potential for declines. How low do you think it is possible to go from here?

Look, I mean, as we mentioned here, we have an underlying vacancy of about 3.2%, excluding the one which we call strategic vacancy, which we do because we are renovating building. We do see a potential that we bring this down further. maybe even slightly below 3%. But obviously, it has an actual end. At one point in time, you do have some turnover. You want some turnover, in fact, because of the reversionary potential that we do have. But for the time being, over the next couple of, say, years, probably at least one to two years, we still see further potential to reduce our rate consumer working on that.

Thank you very much. And then my second question is on acquisitions, both for the own portfolio and for the asset management business. So for the own portfolio, if we look at the guidance that you gave in the capital market, say it looks like you have already fulfilled all the acquisitions pipeline. So any further updates on that? Will you try to recycle further capital into acquisitions? Or do you think you are pretty much done and maybe just the occasional strategic opportunistic acquisition? And for the asset management business, would you consider growing outside of Switzerland given the amount of capital that you've raised? Would you consider doing a bit more in Germany, for example, that you're already there?

All right. In terms of acquisitions, I mean, we are always screening the market. And I think that is very important because we are active managers. Hence, we have to actively manage our portfolio. Hence, we are always in the market. There is no need on that to be on the selling side because as we mentioned a couple of times, we have been able to move our portfolio in the right quadrant. So in the place where we want to be, where we see the highest opportunities in terms of like-for-like growth and value accretion. Having said that, we do have a number of properties which are currently under development where we see residential as the best use. So we will sell those, and that will free up capital that we can invest in new acquisitions. So it's not a static portfolio, but we work with it on a daily basis and want to realize opportunities when we see them. And in terms of going abroad, We are in Germany. We have roughly 1 billion in Germany. We're constantly evaluating the market there. See a little bit of a light on the horizon currently compared to the last couple of years. But we'll have to further evaluate on that and we'll provide you with an update if you see more opportunity than just say organic growth going forward.

Okay, super clear. Thank you.

Thank you so much, Anna.

Our next question comes from Steven Boonmans with ABN AMRO OdoBHF. You may now unmute your line and ask your question.

Hi, good morning and thank you for taking my questions. I have two. So one, could you please quantify in how many acquisition processes you are for your own portfolio today and how that compares to around this time last year?

Sorry, I can't. But we are in a, let's put it like that, in an attractive value number. We are evaluating, but we always do that. But I cannot provide you with more detail. I'm sorry.

Okay. Well, I had to try and maybe use your question. What percentage of non-recurring asset management fees do you assume for 26 and 27?

Our focus here is that we stay at the minimum of these two-thirds that we currently have as recurring fees, hence about one-third could potentially be non-recurring fees. Given the opportunities that we see within the market currently, we see that as very realistic that we stay below that one-third. The one-third, we realized last year, was in the market where, as Anastasios mentioned, we did track record new money, and we were still able to stay at the 66%. And, you know, that is the clear focus. We mentioned right in the beginning the stability, you know, coupled with the plus, with the growth, and that's a key element, obviously, in that we keep that ratio.

Okay. Thank you so much.

Thanks, Stephen.

We currently have no further questions from the webinar.

Wonderful, thank you. Then we have an additional question here from Ken in the room.

Thank you. It's again for Anastasios. Would you be willing to share with us the EBITDA margin of the German business?

We don't disclose. I think what I can disclose is profitable. We're not losing money.

On EBITDA level or what level?

On any level that you want to mention. I think that's an element that we worked on over the last couple of years. It's not yet at the same EBITDA margin that we have here in Switzerland, but it's now at an attractive level, which is sustainable.

When you say not yet, do you expect it to ever reach those levels and on what basis?

let's do Germany in a different part. We'll plan another capital markets day and then we'll provide some additional elements on that. But yes, what we currently see is that Germany is recovering slightly and we want to be there to take an opportunity if that materializes.

Thank you very much.

Wonderful. Dan, thank you so much for your interest, for coming here. It's been a great pleasure to host you here. We see now the fog is a little bit lighter, so you have a little bit more of the view, and now all the participants that are here in the room invite you one floor up to the 35th floor, where we have some light refreshments prepared and continue the good discussions. For everyone on the webcast, thank you so much for your interest in Swiss Primeside, and wish you a wonderful day. Thanks.