SF Sustainable Property Fund: Successful first half of 2021
The SF Sustainable Property Fund achieved solid results in the first half of 2021. The capital increase carried out in April 2021 was successfully completed. All rights were fully exercised, providing the SF Sustainable Property Fund with a flow of funds totalling CHF 66.67 million gross. Rental income increased by 6.47% year on year. The vacancy rate as of the reporting date equals to 6.8%, a reduction of 0.1 percentage points compared to year-end 2020.
- Capital increase successfully completed, full investment shortly afterwards
- 6.47% rise in rental income
- EBIT margin improved by 5% to 63.1%
- Scheduled start of the full refurbishment in Pratteln
- Development project in Lausen successfully concluded
Real estate portfolio
In the first half of 2021, seven new properties with a market value of CHF 60.96 million as at 30 June 2021 were acquired for the SF Sustainable Property Fund. Three more properties were also acquired after 30 June 2021 at a market value of CHF 37.03 million. As a result of the purchases, the fund held 100 properties by mid-year, which is another milestone. The additional purchases also increased the diversification by location/site, size and building fabric to provide a balanced income and risk structure. The new purchases are located in Elsau, Rorschach, Wohlen AG, Oftringen, Olten and Uzwil. The Via Breggia 1/3 property in Vacallo TI was sold on 15 June 2021 in order to optimise the portfolio. The real estate portfolio's market value totals to CHF 1.24 billion as at 30 June 2021.
Renovation projects and developments
The total refurbishment of Längistrasse 7/15/17 in Pratteln began in April 2021. The three buildings comprising 62 apartments in total are being completely refurbished whilst still being inhabited. After the building work has been completed, the property will fully comply with the fund's sustainability criteria (GEAK class C or higher). Work on the new-build project secured in St. Gallen in January 2021 is progressing well. The project involves building two rectangular multi-family homes with 70 small apartments in a sustainable timber construction. The first of the prefabricated UNUS modular apartments has already been delivered. The development project launched in Lausen in 2016 comprising 52 apartments and 52 parking spaces in total was completed on schedule in the first half of 2021. The apartments were already fully let prior to completion. The market value was CHF 26.5 million as at 30 June 2021, the development costs including the building land were around CHF 19.4 million.
Financial result
Rental income in the first six months increased by 6.47% to CHF 22.1 million compared to the first half of 2020. A profit of CHF 0.49 million resulted at the "Purchase in current net income" item thanks to the successful capital increase. The EBIT margin increased in the first six months from 60.1% to 63.1% compared to the first half of 2020 thanks to successful cost management. Net fund assets increased in the reporting period by 7.08% from CHF 854.0 million to CHF 914.5 million. The change is due to the net cash inflow of CHF 66.67 million from the capital increase, the distribution of CHF 24.8 million in March 2021 and the total profit of CHF 20.5 million achieved in the first half of 2021. At 30 June 2021, the stock market price was CHF 159.00 per unit.
Impact of COVID-19
The usage restrictions of the COVID-19 measures imposed by the authorities again on certain sectors did not have a significant impact on the 2021 half-year results.
Outlook
In the second half of 2021, the registered properties will be optimally integrated into the existing portfolio. The ongoing construction projects will continue and be completed by year-end. At the same time, construction projects also need to be prepared for 2022. The data collection for updating the carbon reduction path is already under way and will be completed in the second half of the year. This means that the results can be published in the sustainability report as part of the 2021 annual report.