Business model and strategy

Allreal combines a stable-income real-estate portfolio with the activities of a general contractor (development and realisation).

Underpinned by this proven and successful business model, Allreal is able to cover the entire value chain of a property ? from development and realisation all the way through to profitable long-term property investments. Customers, shareholders and employees benefit from the synergies resulting from the combination of the two divisions alike.

Owing to the fact that Allreal is active neither in the construction industry nor in the ancillary building trade and holds no such investments, independence and transparency in terms of contract awarding are assured. Contracts are awarded entirely on the basis of factual and economic criteria.

The most important operating and financial targets are defined as follows:

 

Return on equity excl. revaluation effect> 5% p.a.
Share of residential properties of total rental income20%
Equity ratio35%
Net gearing / ratio of net financial debt to equity150%
Interest coverage ratio     2.0
Share of debt for portfolio and development properties 70%
Dividend policy100% of the Real Estate division’s
net profit (excl. revaluation effect)

 

Real Estate division
Active management of the portfolio and its continued expansion secure stable added value across the long term. Allreal acquires individual properties or entire real-estate portfolios, optimises them for yield and which, depending on the objective and market situation, are either kept or divested. Allreal operates an in-house facility management organisation which manages a substantial part of the portfolio and, occasionally, works with local or regional facility management companies.

The investments in Allreal’s portfolio are located mainly in Switzerland’s business centres, especially in the metropolitan area of Zurich. The company will maintain this focus. Residential properties account for at least 20 percent of total rental income.

In terms of market value, Allreal owns the third-largest real-estate portfolio of all real-estate companies listed on the SIX Swiss Exchange.

 

Projects & Development division
The Projects & Development division provides services in the development and realisation of real estate. The division’s offer comprises all services connected with the development and realisation of new buildings and the conversion or renovation of buildings aimed at delivering fair market returns and optimal added value. The division develops and realises projects based on a comprehensive approach closely coordinating economic and ecological aspects.

The division provides these services for third parties, on its own account (for resale) and on account of the Real Estate division.

The division’s other activities include the sale of residential property from own development and realisation and advising private individuals, companies and institutional investors with regard to real estate transactions.

Allreal locations are based in Bern and Zurich.

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