Slide 1: Analysts' and media conference: Annual results for 2023
Allreal Group: Analysts’ and media conference Annual results for 2023 Stephan Widrig, CEO Marc Frei, CFO Geneva, 28 February 2024 Lindbergh-Allee 1, Glattpark
Slide 2: Agenda
Allreal Group: Analysts’ and media conference Agenda 1. Highlights of 2023 2. Annual financial results for 2023 3. Perspectives in the Real Estate segment 4. Perspectives in the Development & Realisation segment 5. Outlook and conclusion 6. Questions and discussion 2
Slide 3: Highlights of 2023
Highlights of 2023 Bellerivestrasse 36, Zurich Riesbach
Slide 4: Good operating profit
Highlights of 2023 Good operating profit Net profit excl. revaluation effect (in CHF million) Key drivers: 160 - Higher rental income thanks 142.0 142.9 140 133.3 to active portfolio 124.7 122.0 management and linking to 120 54.2 61.1 inflation and reference 74.6 100 interest rate 61.7 55.3 80 - Goo
Slide 5: Portfolio and long-term value creation
Highlights of 2023 Portfolio and long-term value creation A carefully selected and actively managed portfolio as a secure investment with stable income Balanced mix offices/residential Modern buildings in locations with good public transport connections in urban centres Low vacancy rate, high
Slide 6: Bellerivestrasse 36 successfully handed over to tenant
Highlights of 2023 – Bellerivestrasse 36 successfully handed over to tenant The full width of Allreal’s business model Portfolio Development & Realisation Portfolio Highlights • Fully let, incl. headquarters of La Prairie Group • Previous tenant PartnerRe moved to another Allreal property at Har
Slide 7: Annual financial results for 2023
Annual financial results for 2023 Route de Saint Julien 198, Plan-les-Ouates GE
Slide 8: Good profit in line with expectations
Annual results 2023 Good profit in line with expectations Net profit excl. revaluation effect (CHF million) Net profit incl. revaluation effect (CHF million) 145 142.9 300 142.0 140 243.2 250 135 133.3 200 182.6 167.2 130 154.7 150 124.7 125 122.0 100 120 65.2 50 115 110 0 2019 2020 2021 2022 2023 2
Slide 9: Good cost management contributes to stable profitability
Annual results 2023 Good cost management contributes to stable profitability Operating expenses (CHF million) (CHF million) 31.12.2023 31.12.2022 Change 60 55.7 Net rental income 219.8 214.2 2.6% 51.5 50 Real estate earnings 190.8 186.8 2.1% –7.5% Completed project volume 263.5 319.6 –17.6% 40 Reali
Slide 10: Real Estate: Rental income increases
Annual results 2023 – Real Estate Rental income increases as a result of inflation, higher reference interest rate and addition of completed projects Rental income (CHF million) Composition of increase in rental income (CHF million) 240 219.8 220 214.2 200 180 160 140 120 100 2022 2023 10
Slide 11: Real Estate result improves thanks to higher income
Annual results 2023 – Real Estate Real Estate result improves thanks to higher income and stable expenses Market value of portfolio (CHF million) Real Estate result (CHF million) 6000 200 190.8 5105.7 5097.2 190 186.8 5077.3 5000 4525.3 180 4342.0 170 4000 160 3000 150 140 2000 130 1000 120 110 13.2
Slide 12: Devaluation minor compared to total portfolio value
Annual results 2023 – Real Estate Devaluation minor compared to total value of portfolio and confirms high quality of our properties Geographical distribution of valuation effect (CHF million) 40 20 8.3 3.4 1.3% Devaluation compared to total value 14.1 15.6 of portfolio 7.5 0 -6.0 -4.7 -13.0 -18.9 -
Slide 13: Advantageous maturity profile of commercial leases
Annual results 2023 – Real Estate Advantageous maturity profile of commercial property leases Maturity profile (% of outstanding rental income) 25% 5.0 Weighted remaining term of fixed-term leases for commercial properties (years) 15% 13% 10% 9% 7% 7% 6% 4% 4% 2% 13
Slide 14: Development & Realisation: Stable profitability in implementation
Annual results 2023 – Development & Realisation Stable profitability in implementation Project volume completed 25.7% CHF 263.5 million Third-party projects Own projects portfolio 74.3% 10.6% Gross margin third-party projects Spiserstrasse, Zurich Albisrieden
Slide 15: Lower income burdens income from business activities
Annual results 2023 – Development & Realisation One-off effects from the previous year and lower income place a burden on income from business activities Income from business Composition of income activities (CHF million) -3% from business activities 5% 19% 43% 17.0 Third-party projects Fees from th
Slide 16: Higher volume from own developments; order backlog
Annual results 2023 – Development & Realisation Higher volume resulting from own developments and slight growth in third-party projects targeted Order backlog (CHF million) 800 741 700 694 102 611 600 190 565 149 500 152 400 300 639 504 462 200 412 100 0 2020 2021 2022 2023 Third-party projects Own
Slide 17: Financing: Capital recycling continues
Annual results 2023 – Financing Capital recycling continues Proceeds H1/2023: Proceeds H2/2023: CHF 22.2 million CHF 36.6 million Sale as at 30.6.2023 Sales as at 31.12.2023 Annual target rental income: Annual target rental income: Annual target rental income: CHF 1.4 million CHF 0.5 million CHF 1.0
Slide 18: Key balance sheet figures
Annual results 2023 – Financing Key balance sheet figures Limit 31.12.2023 31.12.2022 31.12.2021 Equity (CHF million) 2 545.1 2 595.9 2 558.3 Equity ratio > 35% 44.5% 45.6% 44.1% Return on equity excl. revaluation effect 5.7% 6.7% 6.5% Net finance debts (CHF million) 2 679.1 2 594.6 2 652.3 Net gear
Slide 19: Allreal driving ahead with green financing
Annual results 2023 – Financing Allreal driving ahead with green financing Debt financing structure as at 31.12.2023 (CHF million) 1000 900 2.5 1.30% 800 2 Avg. interest rate 700 149.6 600 1.5 500 325.0 400 1 300 200 603.0 100.0 148.3 158.6 242.6 0.5 2.69 258.0 181.7 Financial liabilities 100 (CHF b
Slide 20: Unchanged distribution
Annual results 2023 Unchanged distribution Operating profit per share and distribution (CHF) Proposal to the annual general 10.00 meeting of 2024 for an 9.00 unchanged distribution of 8.00 8.65 CHF 7.00 per share 8.34 7.00 7.84 7.39 Of this amount, CHF 3.50 per 6.00 share is deemed to be a 5.00
Slide 21: Confident outlook despite challenging environment
Annual results 2023 Confident outlook despite challenging environment Net operating profit slightly Rising net financial expense Rental income marginally down from the previous year higher, while vacancy rates remain low Slightly higher profits from Marginal increase in project Loan to value (LTV) s
Slide 22: Perspectives in the Real Estate segment
Perspectives in the Real Estate segment Grünhof site, Zurich Aussersihl
Slide 23: Overview of portfolio
Real Estate segment Overview of portfolio Commercial properties/residential (in relation to rental income) 75/25% 3% 83% Basel region Zurich region/Zug region 5.08 1.7% Market value Vacancy rate (CHF billion) (% of target rental income) 227.5 3.8% Target rental income Net return (CHF million) (% of
Slide 24: Office properties well positioned for demand
Real Estate segment Office properties well positioned to meet increasing demand for high- quality locations (public transport), sustainability and vibrant environment 3.4 billion 2 billion Market value of commercial Market value of commercial properties (CHF) properties located in key transport cent
Slide 25: Outstanding key figures for commercial properties
Real Estate segment Outstanding key figures for commercial properties Vacancy rate (%) 3 2.5 2.1 2.0 2 1.8 1.5 1 4.3% Schiffbaustrasse 2, Hardbrücke station, Zurich-West Net yield of commercial properties 0.5 0 Commercial properties 31.12.2022 30.06.2023 31.12.2023 Zollstrasse, Zurich main station 2
Slide 26: Attractive residential portfolio in Zurich and Geneva
Real Estate segment Attractive residential portfolio in urban centres Zurich and Geneva – demand rising faster than supply Regional distribution 0.3% 1.6 billion 26% 32% 2.7% Market value of Net yield of residential properties commercial properties (CHF) 41% City of Zurich Rest of Canton of Zurich W
Slide 27: Own real estate management and technical building management
Real Estate segment Own real estate management and technical building management Benefits for income Long-term tenant relationship Marketing and vacancy management Benefits for costs Appropriate maintenance work Life-cycle cost perspective as owner Benefits for sustainability Energy optimi
Slide 28: Perspectives in the Development & Realisation segment
Perspectives in the Development & Realisation segment Schiffbaustrasse 2, Zurich-West
Slide 29: Collaboration between portfolio management and development
Development & Realisation segment Collaboration between portfolio management and development 3 1 Capital recycling continues Very good 1 Sale of properties with medium macro/micro location to optimise the portfolio of the property III II I Capital recycling 2 Ongoing investments in property Objektqu
Slide 30: Well-stocked development pipeline
Development & Realisation segment Well-stocked development pipeline Projektpipeline per 31.12.2023 (in CHF Mio.) Overview of current projects in planning and construction that will be completed by around 2028 400 In the 815 Condominiums 180 ~220 pipeline CAPEX projects in 2025–2028 condominiums 620
Slide 31: Selection of development projects: portfolio under construction
Development & Realisation segment Selection of development projects Portfolio under construction Renggerstrasse, Zurich (construction period: 2023–2025) Av. de l’Amandolier, Geneva (2023–2025) Estimated investment volume of around CHF 120 million; of which CHF 75 million already financed Increas
Slide 32: Residential development projects for the portfolio
Development & Realisation segment Selection of residential development projects for the portfolio currently in the pipeline Baarermatte, Baar Badenerstrasse, Zurich Fontaines Saintes, Geneva Pré des Dames, Veyrier Residential/Office Residential Residential Residential Project phase Building project
Slide 33: Condominiums under construction
Development & Realisation segment Development projects Condominiums under construction Spiserstrasse, Zurich Project in development since 2018 Construction period: 2023–2025 63 condominiums Investments: CHF 75 million; of which CHF 28 million outstanding Minergie-Eco standard with own phot
Slide 34: Condominiums in the pipeline
Development & Realisation segment Selection of development projects Condominiums in the pipeline Eggen, Lucerne Im Strubenacher, Zumikon ZH At the moment, 9 projects planned, with a projected investment volume of around CHF 315 million The projected target gross margin should be higher than 12%
Slide 35: In-house realisation expertise
Development & Realisation segment In-house realisation expertise… … ... enables flexible action and high quality in in-house projects - third-party projects ensure stable capacity utilisation and competitiveness with an additional contribution to earnings. Höfe Adliswil / Constr. volume: > CHF 200 m
Slide 36: Track record in site development
Development & Realisation segment Many years of experience and excellent track record in site development Escher-Wyss site Bülachguss site The site has been continuously developed since 2007, e.g. a Development and realisation of a new, mixed-use district with new high-rise residential building and
Slide 37: Rieter site in Winterthur offers long-term growth potential
Development & Realisation segment Rieter site in Winterthur offers long-term growth potential 75,000 m2 site in the centre of Winterthur Letting of existing property with ongoing income (e.g. small businesses, logistics, offices) Settlement of long-term users with the possibility of project de
Slide 38: Sustainability
Sustainability 50% reduction in fossil fuels by 2030 65 million Value-enhancing investments in the portfolio by 2030 (CHF) Measures being implemented Energetic refurbishments Expansion of photovoltaic systems Expansion of charging stations for electric vehicles 38
Slide 39: Binding sustainability targets for project developments
Sustainability Binding sustainability targets for project developments / standardised labelling strategy with SNBS Gold Baarermatte, Baar ZG 41.4% - - Aim is for 6 kg CO2e/m2a Innovative timber construction and reuse of parts from the existing of space already certified property * If not suitable or
Slide 40: Outlook and conclusion
Outlook and conclusion Bändliweg 21, Zurich Altstetten
Slide 41: Strong basis, long-term added value
Outlook and conclusion Strong basis, long-term added value Strong portfolio in Zurich and Geneva Three core competencies: real estate, development and realisation Demand for apartments in the urban centres of Zurich and Geneva remains very high going into the new year Re-letting of modern co
Slide 42: Dates for your diary and further information
Outlook and conclusion Dates for your diary and further information 25th annual general meeting 19 April 2024 Half-year results 2024 28 August 2024 Annual results 2024 21 February 2025 Online report Value Update 2023 42
Slide 43: Q&A
Q&A Lindbergh-Allee 1, Glattpark