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.
According to the Federal Office for the Environment, the construction sector accounts for a good quarter of the greenhouse gases emitted in Switzerland. It is therefore important to reduce CO2 emissions in this area. Heat pumps are at the top of the list of possible solutions in this regard. This technology massively reduces CO2 emissions and – in combination with modern building insulation – also leads to significantly lower ancillary costs for tenants.
Comfortable warmth through innovation: how heat pumps are used
This focus of this issue of “Exposé” is on heat pumps. We shed light on the history of this technology, which can be traced back to pioneering projects carried out by industrial visionary Escher Wyss in Zurich. As early as 1938, for example, the first heat pump in Europe was installed in Zurich’s town hall to heat the building.
We take you on a tour of our properties in Switzerland and abroad, where you will find out what types of heat pumps are used: in Zurich’s Seefeld district, for example, water from Lake Zurich is used, while elsewhere you can find air-to-water heat pumps or geothermal heat pumps.
Swiss Life Asset Managers is committed to proactive repositioning, renovations and intelligent repurposing.
While investments in new builds are dwindling due to interest rate hikes, well-positioned existing portfolios are benefiting from higher asking rents – and this includes real estate products from Swiss Life Asset Managers.
This issue of “Exposé” examines the latest developments in the area of commercial space. The construction of new office and retail space fell sharply in 2022, although the labour market is still booming and the potential for further employment growth remains strong. It is therefore vital to make use of existing commercial space, to adapt it flexibly and position it cleverly on the market.
A peek at our range of commercial space reveals, amongst other things, how a commercial building in St. Gallen’s city centre has been revitalised, how customised interior fit-out solutions have improved the positioning of a residential and commercial building in Zurich’s Seefeld district, and how converting and extending an office building in the heart of the English city of Manchester led to rental success.
Even in the current challenging environment with rising inflation and higher interest rates, returns on real estate investments are proving to be surprisingly robust. So real estate is still definitely worth a second look.
This issue of "Exposé" also examines the growth of cities. Although many people have moved out of the urban centres, especially during and after the pandemic, Swiss cities remain attractive. With appealing public spaces and significant potential for densification, they continue to offer great growth opportunities.
As always, we take you on a short tour of selected commercial and residential properties. The journey ranges from a replacement new-build high-rise at the foot of Zurich's local mountain to an intergenerational project in Aargau and on to Oldenburg, Germany, with an attractive, energy-efficient residential development project close to the countryside.
The office market is adapting to the requirements of the new hybrid and mobile working and occupancy models and remains attractive. The upturn on the Swiss labour market is also having a positive impact on the commercial property market. Moreover, the Federal Government’s economic scenarios are anticipating significant medium-term growth in the sectors set to consume office space.
So things look good for the office real estate market. Rental price statistics show that office rents have even risen significantly on average since the end of 2019. These trends are highlighted in this issue of "Exposé".
We take you to lofty heights on a sightseeing tour of some of our selected commercial and residential properties. Now integrated in the "Exposé" you will find drone videos that open up new perspectives.
Even in difficult times, many people are looking for a shopping experience and are increasingly returning to the shops after having been forced to make online purchases during the lockdown. Retail properties in an excellent location are therefore a good cushion for investors. In this issue, "Exposé" takes you on a short stroll through popular Swiss shopping streets and presents high-quality properties in central locations.
A comparison of the Chinese and Swiss real estate markets shows that the Swiss rental market is having an overall stabilising effect on the economy. While in China the ownership rate is around 90 percent, only around 36 percent of the Swiss own property.
In terms of the Swiss rental market, investors benefit from the high quality of Swiss Life Asset Managers’ portfolios, which prove to be crisis-resistant thanks to a good mix, a focus on central locations and high-quality properties.
Real estate is one of the most valuable asset types and is considered a solid investment option even in uncertain times. A particularly innovative example from the retail sector is the "Glatt" shopping centre, to which Swiss Life Asset Managers dedicates a portrait in this issue of "Exposé".
Despite the crisis, Swiss Life Asset Managers can look back on a pleasing final quarter of 2020: Swiss Life REF (CH) Swiss Properties managed the largest capital increase ever – CHF 500 million – for a listed real estate fund in Switzerland.
As the new Head of Real Estate Portfolio Management, Third-Party Asset Management, Marie Seiler and her team will manage investment business for third-party clients in Switzerland. ESG criteria are taken into account, and the growth of high-quality properties plays an important role. Swiss Life Asset Management aims to further enhance the attractiveness of the real estate asset class on a national and international level.
"Even the stones placed in one’s path can be made into something beautiful." Goethe's quotation applies particularly in times of COVID-19. The long-term effects of the lockdown on society and the economy are still unclear. However, changes in human behaviour could change demand for commercial and residential properties. The ongoing structural change is expected to accelerate significantly and encourage innovation.
Now more than ever, Swiss Life Asset Managers is called upon to prove its innovative strength and sustainable management. Examples of such investments include the original Zurich "capsule hotel" and the photovoltaic system for the generation of electricity from a commercial property in Dietlikon. Other attractive projects featured in this "Exposé" issue include the "Rhyvage" and "Sunnepark" developments with their coveted multigenerational apartments. Fortunately, both were completed without any interruptions, thanks to existing protection concepts.
People are social beings. This makes it all the harder for many to observe the distancing rules. And it’s no different for Swiss Life Asset Managers employees. They are also working from home consistently. But even if everything runs smoothly from a technical point of view: there is no direct interpersonal exchange.
Restrictions and strict rules are currently unavoidable in restaurants and shops. Swiss Life Asset Managers is working with tenants to find partnership-based solutions to continue sustainable letting. Properties in a well-frequented location remain in demand even in times of crisis. One example of this is the residential and commercial property on the elegant Via Nassa in Lugano, which Swiss Life Asset Managers presents in this edition of "Exposé".
During its more than 160 years, Swiss Life Asset Managers has already overcome a range of challenges. It will also successfully master the coronavirus crisis – with the requisite humility and confidence.