Strategy & Business model

Allreal covers the entire property value chain, from development and realisation to long-term property investment including portfolio management, building management and real estate management.

Allreal strives to achieve sustainability-oriented, consistent qualitative growth, steady returns and a stable distribution yield for its shareholders aimed at dividend growth.

The portfolio is developed organically and by means of acquisitions on a continuous basis. High quality standards are adhered to at all times. Allreal operates exclusively on the Swiss market.

The synergies between the two divisions Real Estate and Projects & Development are obvious: The Group develops and realises sustainable projects for its own portfolio and for sale to third parties. At the same time, Projects & Development also carries out orders for third parties. Allreal focuses on projects with calculable risks, realistic contract terms and intact profit expectations. With its selective participation in the third-party market, Allreal ensures that its construction activities remain competitive.

In the Real Estate division, the company has considerable expertise thanks to its many years of experience in portfolio management and the technical and commercial management of its own yield-producing properties. The investments are located mainly in Switzerland’s business centres, especially in the metropolitan area of Zurich and the canton of Geneva. Residential properties account for at least 20 percent of total rental income.

Allreal has many years of experience in the holistic assessment of properties and offers customers tailored solutions covering everything from development and realisation to the operation of a property. Since the company 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.

 

Real Estate division
The Real Estate division secures stable added value over the long term with its active management and focus on a high-quality portfolio. Portfolio growth is primarily driven by in-house projects, but the acquisition of individual properties or whole property portfolios is also considered on an ongoing basis. Acquisitions are optimised for yield and, depending on the objective and the market situation, are either kept or sold. The focus is on a high level of customer benefit combined with an increase in profitability with the lowest possible vacancy rates.

 

Projects & Development division
The Projects & Development division provides services in the development and realisation of real estate. In doing so, Allreal focuses on quality, adherence to deadlines and cost control. The division’s offering comprises all services necessary for delivering fair market returns and optimal added value on new buildings and building conversions and renovations. The Development department acquires development reserves or properties with upside potential. In these spaces, Allreal plans new properties using a holistic approach and realises them in such a way that economic, environmental and social aspects are taken into account as comprehensively as possible. Further activities include the sale of residential property developed and realised in-house by Allreal.

Business model

 

 

 

Operating and financial targets

Distribution yield – share of the Real Estate division’s net profit (excl. revaluation effect) 100% 
Relative share performance – positive deviation from the SXI Real Estate Shares TR comparison index > 0
Share of residential segment in total rental earnings 20%
Weighted average unexpired lease term (WAULT) > 48 months
Gross margin third-party projects Projects & Development division > 10%
Interest lock-in period for financial liabilities > 48 months
Return on equity excl. revaluation effect > 5%
Equity ratio 35%
Net gearing (ratio of net financial debt and equity) 150%
Interest coverage ratio      2.0
Capital gearing on investment real estate and development real estate 70%
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