UBS Sima: Construction projects drive earnings
The largest listed Swiss real estate fund increased its rental income by 3.1 % and added around CHF 550 million to its portfolio. In December, the fund sold the Kameha Grand Hotel in Opfikon.
UBS Sima reported rental income of CHF 457.6 million in the 2025 financial year, an increase of CHF 13.8 million compared to the previous year. The fund management company cites the appreciation of major construction projects as the main driver - above all «Younic» in Dübendorf (ZH), the «Birsgarten» retirement center in Reinach (BL) and the new building on Anna-Heer-Strasse in Zurich. The residential share of total income is now 56.8 %.
The rent default rate rose slightly from 3.5 % to 3.7 %, but remains below the long-term average. In the residential portfolio, it is only 2.0 %. In contrast, there was a notable increase in individual commercial properties. At Sägereistrasse 10 in Glattbrugg, the vacancy rate rose from 52.5 % to 66.8 %, while Neuhofstrasse 11 in Reinach (BL) deteriorated from 42.8 % to 51.3 %. The Mundaun Center in Ilanz remains virtually vacant with a default rate of 98.3 %. Moosbruggstrasse 1, 3 in St. Gallen saw the opposite trend, with the default rate falling from 42.8 % to 17.3 %.
New apartments, higher market values
The portfolio volume grew by 4.5 % to CHF 12.72 billion. Wüest Partner, as the valuation expert, puts the average discount rate at 2.66 % (previous year: 2.72 %). The share of residential buildings in the portfolio value rose from % 50.9 to % 54.9, whereby part of the increase is due to a harmonization of the property categories: retirement, student and short-term housing are now included in residential buildings.
The «Younic» project in Dübendorf (ZH) comprises 228 rental apartments and around 400 square meters of commercial space, with an investment volume of CHF 201 million and an annual rental income of CHF 6.6 million. The occupancy rate is over 99 %. In Reinach (BL), the «Birsgarten» retirement center with 88 care rooms and 52 retirement apartments was completed and handed over to Senevita as operator on 1 December; the 15-year rental agreement will generate CHF 3.0 million per year from the third year of operation. On Anna-Heer-Strasse in Zurich, 83 apartments were built in timber hybrid construction with an investment volume of CHF 41 million and rental income of CHF 3.2 million with an occupancy rate of over 97 %.
Net income and comprehensive income increase
Net income rose from CHF 220.4 million to CHF 253.5 million, which corresponds to an EBIT margin of % 71.9 (previous year: % 68.8). The improvement is largely due to the reduction in the management fee, which was set at a uniform 0.54 % of total fund assets as at January 1. As a result, the fund operating expense ratio (TER) fell to % 0.67 (previous year: % 0.77). On the other hand, taxes and duties rose by around CHF 10 million to CHF 30.8 million, which the fund management explains with lower tax-recognized interest rates from the Swiss Federal Tax Administration and the consequences for the fund's real estate companies. CHF 105.5 million was spent on refurbishments.
Unrealized capital gains of CHF 346.5 million are offset by realized capital losses of CHF 6.5 million. After deducting the higher estimated liquidation taxes of CHF 104.7 million, total income amounted to CHF 488.8 million (previous year: CHF 370.0 million). The distribution remains at CHF 3.25 per unit, which corresponds to a return of CHF 2.0 % with a payout ratio of 98.8 %. The return on investment amounted to % 6.2 (previous year: % 5.3).
Capital increase and lower debt
In May, the fund completed a capital increase of around CHF 350 million. The funds will be used for construction projects and to reduce borrowed capital. The debt ratio fell from 25.7 % to 23.4 %. On the stock exchange, the share price rose from CHF 152.50 to CHF 158.80, which corresponds to a performance of 7.8 %. The benchmark index SXI Real Estate Funds TR achieved 10.6 % in the same period.
In its outlook, the fund management refers to the «Turicum» program, which aims to leverage the construction potential in the city of Zurich. Overall, it puts the internal growth potential of the portfolio at over CHF 3 billion, of which CHF 1.2 billion can be realized in the medium term.
Sales
Opfikon, Dufaux-Strasse 1 (Kameha Grand Zurich, Hotel), as at December 19. In the half-year report, the fair value of the property acquired in 2015 was stated at CHF 77.0 million and the acquisition costs at CHF 120.9 million.
Purchases
A bolt-on acquisition at Carl-Spitteler-Strasse 6-24 in Zurich (residential buildings) was recorded on March 3. (aw)
