In 2022 and 2023, rising interest rates painted a bleak picture of the future for the real estate sector. Pessimists feared a real estate crisis that would rock Switzerland as in the 1990s. Today, however, the economic environment looks significantly different. Inflation and interest rate expectations are lower, and the real estate market drivers are highly intact. However, the persistent shortage of living space is dampening the positive outlook a little. Swiss Life Asset Managers is working on solutions that are economically profitable and benefit society as a whole.
In Switzerland, demand for housing is being fuelled by steady economic growth and low unemployment. High immigration and changes in residential behaviour are further exacerbating the situation. However, the high demand is offset by a slow growth in supply, particularly in Swiss cities.
Certain structural hurdles in residential construction will not disappear overnight. Building permit procedures are becoming increasingly complex, and there are more and more objections and appeals. The number of newly approved apartments is at an all-time low, with so few new buildings recently built at the beginning of 2004. So we need solutions that can be implemented relatively quickly. There are two main approaches for Swiss Life Asset Managers: convert buildings or build up.
This issue of “Exposé” therefore focuses on projects from the Swiss Life Asset Managers real estate portfolio that illustrate how former offices are being converted into attractive apartments and how cleverly adding storeys to existing residential buildings in cities, even in prime locations, can create additional living space in prime locations.
