Indirect Real Estate Investments

Strong Market Momentum

The SNB’s interest rate cuts have reignited investor enthusiasm for indirect real estate investments. Swiss listed real estate funds raised CHF 2.2 billion in 2024 – the highest amount in the past five years. The market saw a broad-based rebound, with investor sentiment strengthening as monetary policy shifted towards easing.

Trading Insights

2024 was a landmark year for Swiss listed real estate, characterised by record index levels, sector consolidations, and heightened investor engagement.

REAL Index: A New All-Time High

The REAL Index closed 2024 at 3 778.47 points, reaching a new all-time high after gaining +14.2% over the year. The strongest gains occurred in the second half of the year, fuelled by SNB rate cuts and investor reallocation towards defensive real estate stocks.

Among the top performers:

• Zug Estates, Züblin Immobilien, and EPIC Suisse delivered annual returns of around 30%.
• Swiss Prime Site and PSP Swiss Property also saw double-digit gains, benefiting from their large-scale, well-capitalised business models and stable dividend distributions.

SWIIT Index: Listed Real Estate Funds Surge Amid Sector Consolidation

The SWIIT Index gained +17.6% in 2024, outperforming broader Swiss equities. The most significant rally occurred in Q4 2024 (+7.1%), as investor confidence strengthened following multiple SNB rate cuts.

Notable winners:

• UBS Residentia (+55.0%) and UBS REF Hospitality (+51.3%) surged following the November announcement of multiple UBS and ex-Credit Suisse real estate fund mergers.
• Helvetica Swiss Commercial Fund (+39.1%) surged due to asset disposals that improved the liquidity situation and following regained investor confidence with a new management team.

Liquidity Surge: Increased Trading Volumes

• Listed real estate companies trading volumes remained stable at CHF 7.7 billion in 2024, slightly above CHF 7.5 billion in 2023. Despite remaining below historic peaks (CHF 10.2 billion in 2019, CHF 15 billion in 2020), the positive trend continued into early 2025.
• Fund trading activity saw strong momentum, with total transaction volumes rising +19% YoY to reach CHF 13.5 billion in 2024, supported by:
  • Increased capital raising, with CHF 2.2 billion in new issuances – the highest in five years.
  • Rising valuations and investor confidence, leading to stronger participation.
  • Market expansion, with SWIIT fund listings growing from 29 in 2015 to 44 by 2024, alongside an overall market capitalisation jump from CHF 35.8 billion to CHF 69.8 billion.

Market Outlook and Trading Themes for 2025

Looking ahead, three key trends are likely to shape Swiss real estate markets in 2025:

• Capital Increases to Accelerate – Fund managers are expected to continue taking advantage of strong investor demand to issue new capital, though high valuations may temper performance.
• Consolidation Trends Continue – The planned merger of Helvetica Swiss Opportunity Fund with Helvetica Swiss Commercial Fund will be a key event that could spur further industry restructurings.
• Investor Demand for Prime Residential and Logistics Assets – Well-located residential and logistics properties remain top investment priorities.
• As monetary policy continues to ease, real estate remains a strategic sector for investors seeking stability, yield, and long-term capital appreciation.