Half Year 2026 PSP Swiss Property AG Earnings Call

August 18, 2026

Speaker #1: Ladies and gentlemen, welcome to the PSP Swiss Property Half-Year Results 2026 conference call. I am Maira DiCarusco, your operator. I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded.

Operator: Ladies and gentlemen, welcome to the PSP Swiss Property Half Year Results 2026 conference call. I am Maya, the call operator. I would like to remind you that all participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it is my pleasure to hand over to Giacomo Balzarini, CEO of PSP Swiss Property. Please go ahead, sir.

Speaker #1: The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and 1 on your telephone.

Speaker #1: For operator assistance, please press star and 0. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Giacomo Baldarini, CEO of PSP Swiss Property.

Operator 1: The conference must not be recorded for publication or broadcast. At this time, it is my pleasure to hand over to Giacomo Balzarini, CEO of PSP Swiss Property. Please go ahead, sir.

Speaker #1: Please go ahead, sir.

Speaker #2: Thank you. Good morning, everybody, and welcome to our release of the half-year results. As always, I will do a quick rundown of the key highlights and then open for questions, as I have seen we have many participants.

Giacomo Balzarini: Thank you. Good morning, everybody, and welcome to our release of the H1 results. As always, I will do a quick rundown of the key highlights and then open for question, as I have seen we are many participants. We are pleased to report strong H1 results. They are predominantly driven by the already announced disposal of the Richti Park sale. We report an adjusted like-for-like growth of 1.7%. You remember that Q1 2025 we had a one-off effect on the costs, which would have had a negative impact. So without that, it is a 0.7%, but on a like-for-like basis unadjusted to 1.7%. We report a strong valuation against of CHF 112 million on the back of already a reported gain in Q1.

Speaker #2: We are pleased to report a strong half-year result. Predominantly driven by the already announced disposal of the Richter Park sale, we report an adjusted like-for-like growth of 1.7%.

Speaker #2: You remember that in Q1 2025, we had a one-off effect on the costs, which would have had a negative impact. So, without that, it is 0.7%, but on a like-for-like basis, after adjustment, it is 1.7%.

Speaker #2: We report a strong valuation gain of 112 million on the back of an already reported gain in Q1. We demonstrate, and continue to demonstrate, very strong cost discipline and very stable financials.

Giacomo Balzarini: We demonstrate and continue to demonstrate a very strong cost discipline and a very stable financials, which has been recognized by Moody's with an upgrade on the rating from an A3 to A2. Furthermore, we have seen again, lower taxes, release of deferred taxes more than CHF 10 million in the H1, which clearly helps the earnings per share growth on a like-for-like basis. If you look at the market, we are confronted with a very healthy letting market. The vacancy rate in the H1 went slightly up to 4%. That is driven by the reclassification of the Hotel des postes. But also here we have a strong visibility for letting successes. Here we are already at the letting state is more than 70%, so the vacancy rate by year-end will come back down to 3.5%.

Speaker #2: This has been recognized by Moody's with an upgrade of our rating from A3 to A2. Furthermore, we have again seen a lower tax expense due to the release of deferred tax of more than CHF 10 million in the first half, which clearly helps the earnings per share growth on an annual basis.

Speaker #2: If you look at the market, we are confronted with a very healthy letting market. The vacancy rate in the half-year went slightly up to 4%.

Speaker #2: That's driven by the reclassification of the hotel deposit. But also here, we have strong visibility for letting successes at year-end. We are already at a letting status of more than 70%, so the vacancy rate by year-end will come back down to 3.5%.

Speaker #2: And we see some early signs of recovery in Basel, especially in the Peter Merian building. We had some letting successes, and we are in discussions for further lettings.

Giacomo Balzarini: We see some early signs of recovery in Basel, especially in the Peter Merian building. We had some letting successes, and we are in discussions for further lettings. So we see first signs of a recovery also in that market. On the transactional side, we continue to see a very strong market, although there are rather little opportunities in our target segment. Clearly the valuation gains were a demonstration by the strong market, but also by a strong cash flow development. Our outlook is confirmed at the EBITDA guidance of CHF 335 million. Also, vacancy rate guidance is confirmed at 3.5%, despite the slight increase in the H1. The top line will come a bit down by the year-end due to the disposals of the Richti Park and the Gurtenbrauerei of last year, and developments which are going on.

Speaker #2: So, we see the first signs of a recovery also in that market. On the transactional side, we continue to see a very strong market, although there are rather few opportunities in our target segment.

Speaker #2: But clearly, the valuation gains were a demonstration by the strong market, but also by strong cash flow development. Our outlook is confirmed at the EBITDA guidance of CHF 335 million. Also, vacancy rate guidance is confirmed at 3.5%, despite the slight increase in the half year.

Speaker #2: The top line will come a bit down by the year-end due to the disposal of the Richter Park and the Gurten of last year.

Speaker #2: And developments which are ongoing, but overall we are on target to continue our shareholder-friendly dividend policy throughout the year. So, all in all, a very solid and strong half-year result.

Giacomo Balzarini: Overall, we are on target to continue our shareholder-friendly dividend policy throughout the year. All in all, a very solid and strong H1 result. With that, I would like to end my entry remarks and hand over for Q&A.

Speaker #2: With that, I would like to end my introductory remarks and hand over for Q&A.

Speaker #1: We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their telephone. You will hear a tone to confirm that you have entered the queue.

Operator 3: We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and One on their telephone. You will hear a tone to confirm that you have entered a queue. If you wish to remove yourself from the question queue, you may press Star and Two. Anyone who has a question may press Star and One at this time. The first question comes from the line of Ken Kagerer from ZKB. Please go ahead.

Operator: We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and One on their telephone. You will hear a tone to confirm that you have entered a queue. If you wish to remove yourself from the question queue, you may press Star and Two. Anyone who has a question may press Star and One at this time. The first question comes from the line of Ken Kagerer from ZKB. Please go ahead.

Speaker #1: If you wish to remove yourself from the question queue, you may press star and 2. Anyone who has a question may press star and 1 at this time.

Speaker #1: The first question comes from the line of Ken Calgary from ZKB. Please go ahead.

Speaker #3: Yes, good morning, everyone, and thank you for taking my questions. The first two are with regards to the financing, the credit financing. Firstly, I've noticed that the duration is becoming shorter and shorter.

Ken Kagerer: Yes. Good morning, everyone, and thank you for taking my questions. The first two, with regards to the financing, the credit financing. Firstly, I have seen that the duration is becoming shorter and shorter. What is the strategy behind here? Do you just intend to go more below three years? Or is it again, something that you think about a longer duration? The second one is with regards to the pricing of potential bonds following the rating change by Moody's. What is the impact there we can expect, in your opinion? The last one is on the like-for-like growth. You have shown some adjustments here. Could you please detail the reasons for those? Thank you very much.

Speaker #3: What is the strategy behind this? Do you intend to go further below three years, or is it something that you consider over a longer duration?

Speaker #3: The second one is with regards to the pricing of potential bonds following the rating change by Moody's. What is the impact there? What can we expect, in your opinion?

Speaker #3: And the last one is on the like-for-like growth. You have shown some adjustments here. Could you please detail the reasons for those? Thank you very much.

Speaker #2: Thank you, Ken. On the duration, as you remember, we are of the opinion, first of all, that we have a very strong inflation link in the portfolio of more than 90%.

Giacomo Balzarini: Thanks, Ken. On the duration, as you remember, we are of the opinion, first of all, that we have a very strong inflation link in the portfolio of more than 90%. So we have a strong protection on inflation increase, which in our view would then clearly be triggering the interest increase. We have seen that in the last cycle. Secondly, the low debt and the lowering debt is an additional protection for us. I think if you look back historically, we always navigated within a duration of 2.5 to four years. What we try to do is to have a constant maturity of the debt, and then whenever we have a maturity, we clearly look at the curve. So for us, the three-year is fine. But obviously, whenever we see that there is a window, we go a bit longer.

Speaker #2: So, we have strong protection against inflation increases, which in our view would then clearly trigger an interest rate increase. We have seen that in the last cycle.

Speaker #2: Secondly, the low debt and the lowering debt is an additional protection for us. And I think, if you look back historically, we always navigated within a duration of two and a half to four years.

Speaker #2: What we try to do is to have a constant maturity of the debt. And then, whenever we have a maturity, we clearly look at the curve, so for us, a three-year is fine.

Speaker #2: But obviously, whenever we see that there's a window, we go a bit longer. But with the protections I mentioned, with inflation-linked and with the low debt, I think we're fine to be a bit on the shorter end of the duration.

Giacomo Balzarini: But with the protections I mentioned, with inflation linked and with the low debt, I think we are fine to be a bit on the shorter end of the duration, which has been our strategy over the last 25 years. With regard to the pricing of the bond, I think it is a bit early days. I think what can be said that it is a rating improved. So clearly, if you look at the bond pricings and credit pricings, they are very strongly linked to a rating. How much this then makes up, we will see when we come up with the next bond pricing. We are in discussions continuously with the banks and the DCM teams. So I would expect an improvement. However, I think we talk on a single-digit levels, with regard to spread levels. You have also keep in mind that those spread levels change also the time.

Speaker #2: Which has been a bit our strategy over the last 25 years. With regard to the pricing of the bond, I think it's a bit early days.

Speaker #2: I think what can be said is that it's a rating improvement. So, clearly, if you look at the bond pricings and credit pricings, they're very strongly linked to a rating.

Speaker #2: How much this then makes up, we will see when we come up with the next bond pricing. We are in discussions continuously with the banks.

Speaker #2: And the DCM teams, so I would expect an improvement. However, I think we're talking on a single-digit level with regard to spread levels. And you also have to keep in mind that those spread levels change over time.

Speaker #2: So it's also difficult, then, to compare with former spread levels. On the like-for-like adjustment, this is just if we would just report the like-for-like, as we did, and we report, it's a 0.7% increase.

Giacomo Balzarini: It is also difficult then to compare with former spread levels. On the like-for-like adjustment, if we would just report the like-for-like as we did, and we report it is a 0.7% increase. If you recall last year on the Rue du Marché in Geneva, in Q1, we had a very strong tax benefit which reduced the Q1 cost disproportionally. If you take out that effect, the like-for-like of this half year would be 1.7%. It is only based on the letting activities without a single cost effect coming out of the Rue du Marché. Thank you very much.

Speaker #2: If you recall, last year on the Rue du Marché in Geneva, in the first quarter, we had a very strong tax benefit, which reduced the Q1 costs disproportionately.

Speaker #2: If you take out that effect, the like-for-like of this half-year would be 1.7%. This is only based on the letting activities, without a single cost effect coming out of the Rue du Marché.

Speaker #3: Thank you very much.

Speaker #1: The next question comes from the line of Holger Frisch from Raiffeisen. Please go ahead.

Operator 3: The next question comes from the line of Holger Frisch from Raiffeisen. Please go ahead.

Operator: The next question comes from the line of Holger Frisch from Raiffeisen. Please go ahead.

Speaker #3: Yes, good morning from Raiffeisen. Thanks for taking my question. I have two questions. The first one would be on the two earn-out agreements relating to the sale of Richterpark and the acquisition of the property Schützengasse, Beatengasse.

Holger Frisch: Good morning from my side, and thanks for taking my question. I have two questions. The first one would be on the two earn-out agreements relating to the sale of the Richti Park and the acquisition of the property Schützengasse / Beatengasse. What do the earn-out agreements entail, and what is the timeframe for the payments? Could you remind us of the annual rental income of the newly acquired property? That would be the first one.

Speaker #3: So, what do the earn-out agreements entail, and what is the timeframe for the payments? And could you remind us of the annual rental income of the newly acquired property?

Speaker #3: That would be the first one.

Giacomo Balzarini: The earn-outs, there are three earn-outs on the Richti Park, which are linked to the progress of the developments and the permissions of the developments. These are earn-outs which are linked to CHF 10 million, CHF 10 million, and CHF 5 million. Probability, I would say, is difficult to say because it is really now in the hands of the new owner in that phase. We will review every quarter what the status is. If the probability of having a successful potential earn-out is higher than 50%, we will book out that earn-out phase. With regard to the Schützengasse, the new rental income is roughly CHF 2 million per year.

Speaker #2: The earn-out—there are three earn-outs on the Richter Park—which are linked to the progress of the developments and the permissions of the developments.

Speaker #2: These are earn-outs which are linked to 10, 10, and 5 million. Probability, I would say, is difficult to say because it's really now in the hands of the new owner.

Speaker #2: And in that case, we will review every quarter what the status is. And if the probability of having a successful potential earn-out is higher than 50%, we will book out that earn-out phase.

Speaker #2: With regard to the Schützinghaus, the new rental income is roughly CHF 2 million per year.

Holger Frisch: Okay, thanks.

Speaker #3: Thank you. Thanks. And then.

Speaker #2: But I can hardly hear you, Holger.

Giacomo Balzarini: I hardly hear you, Oliver.

Speaker #3: Okay, maybe better this way. Second question would be on the increase in the property values in Zurich. You said they were broadly based, but were they—or are they—broadly based, or were there individual properties that saw more significant increases?

Holger Frisch: Okay. Maybe better this way. Second question would be on the increase in the property values in Zurich. You said they were broadly based, but are they broadly based or were there individual properties that saw more significant increases in H1?

Speaker #3: And the first half of the year.

Speaker #2: Well, I would say they're broadly based wherever is in the CBD or close to the CBD. Besides the one in the Löwenbräu site, which we reported in Q1, the others are all around the Bahnhofstraße.

Giacomo Balzarini: Well, I would say they are broadly based, whatever is in CBD or close to CBD. Beside the one in the Löwenbräu side, which we reported to Q1, the others are all around the Bahnhofstrasse. There are some also in the Ringstrasse, and clearly also the Hürlimann site, so some appreciation. There was also one in Geneva, which was above the top 10.

Speaker #2: There are also some in the Pfingstweidstrasse, and clearly also the Hürlimann site. So some appreciation. There was also one in Geneva, which was above the top 10.

Speaker #3: Okay, great. Thank you.

Holger Frisch: Okay, great. Thank you.

Speaker #1: The next question comes from the line of Alexander Tutomanov from Green Street. Please go ahead.

Operator 3: The next question comes from the line of Alexander Totormanov from Green Street. Please go ahead.

Operator: The next question comes from the line of Alexander Totormanov from Green Street. Please go ahead.

Speaker #3: Hello, good morning, and thank you for taking my questions. Two questions from me. What is the deferred taxes release expected for the full year?

Alexander Totormanov: Good morning, and thank you for taking my questions. Two questions from me. What is the deferred taxes release expected for the full year? Is it still consistent with the guidance of about CHF 10 million? Second question, how are the discussions for the rest of the vacant area in Hotel des postes in Lausanne progressing, and what areas are left to lease out? I think you said that the leases commencing in Q3 and Q4 are going to take you up to about 70% occupancy.

Alexander Totomanov: Good morning, and thank you for taking my questions. Two questions from me. What is the deferred taxes release expected for the full year? Is it still consistent with the guidance of about CHF 10 million? Second question, how are the discussions for the rest of the vacant area in Hotel des postes in Lausanne progressing, and what areas are left to lease out? I think you said that the leases commencing in Q3 and Q4 are going to take you up to about 70% occupancy.

Speaker #3: Is this still consistent with the guidance of about CHF 10 million? And second question, how are the discussions for the rest of the vacant area in Hôtel de Poste in Lausanne progressing?

Speaker #3: And what areas are left to lease out? I think you said that the leases commencing in Q3 and Q4 are going to take you up to about 70% occupancy.

Speaker #2: Thank you. With regard to the guidance on deferred taxes, it's roughly CHF 14 million that we see for the full year. With regard to Hotel de Poste, we are in advanced negotiations with a tech company on a larger floor.

Giacomo Balzarini: Thank you. With regard to the guidance on deferred taxes, it is roughly CHF 14 million we see for the full year. With regard to Hotel des postes, we are in advanced negotiation with a tech company on the larger floor. The one which are left to be rented out is the highest floor, the fifth floor, which has a rooftop terrace. On the rooftop terrace, we have a concept for the summer periods. The other one is not super high ceiling. I think here we have a couple of options. Then on the right and left side of the wings, we have some little floor plates. But with the discussions with this tech company, which is active in the AI field, we are fairly advanced. Beside that, we have a very little retail area left, so it is really then more of a filling up.

Speaker #2: The one which is left to be rented out is the highest floor, the fifth floor, which has a rooftop terrace. On the rooftop terrace, we have a concept for the summer periods.

Speaker #2: The other one does not have a super high ceiling, so I think here we have a couple of options. And then, on the right and left side of the wings, we have some small floor plates. But with the discussions with this tech company, which is active in the AI field, we are fairly advanced.

Speaker #2: Beside that, we have a very little retail area left so it's really then more of a filling up. We are still waiting for some we are still waiting for some building permissions.

Giacomo Balzarini: We are still waiting for some

Alexander Totormanov: 3 minutes.

Alexander Totomanov: 3 minutes.

Giacomo Balzarini: We are still waiting for some building permissions for the fit-out works, so this causes a slight delay on the tenant starting their works. And clearly with that, then also slight delay in starting of the contracts. Here we talk about perhaps one, 2 months delays in that. But everything is going very well. Thank you.

Speaker #2: For the fit-out works, this causes a slight delay in the 10 starting their works. And clearly with that, there is also a slight delay in the start of the contracts here.

Speaker #2: We talk about perhaps one- to two-month delays in that, but everything is going very well. Thank you.

Speaker #3: Thank you.

Alexander Totormanov: Thank you.

Alexander Totomanov: Thank you.

Speaker #1: As a reminder, if you wish to register for a question, please press star one on your telephone. The next question comes from the line of Tomaso Perto from UBS.

Operator 3: As a reminder, if you wish to register for a question, please press star and one on your telephone. The next question comes from the line of Tommaso Operto from UBS. Please go ahead.

Operator: As a reminder, if you wish to register for a question, please press star and one on your telephone. The next question comes from the line of Tommaso Operto from UBS. Please go ahead.

Speaker #1: Please go ahead.

Tommaso Operto: Hey, good morning. I just have one question, and it is fairly speculative, so apologies. I am wondering on the dividend. Now that you have gone through the Richti Park sale, with spreads continuing to be at very tight levels, this balance sheet super healthy, is there any chance of a bigger dividend step up potentially coming through? Or is there anything you could share on that policy front?

Speaker #4: Hey, good morning. I just have one question, and it's fairly speculative, so apologies. But I'm wondering about the dividend. I mean, now that you've gone through that Richter Park sale, with the spreads continuing to be at very tight levels, is the balance sheet super healthy?

Speaker #4: Is there any chance of a bigger dividend step-up potentially coming through, or is there anything you could share on that policy front?

Speaker #2: Thank you, Tomaso. Well, it's not a speculative question. It's just in the responsibility of the Board. I think what I can say, what we did in the past—in the last 25 years—we never had special dividends.

Giacomo Balzarini: Thank you, Tommaso. Well, it is not a speculative question. It is just in the responsibility of the board. I think what I can say, what we did in the past, in the last 25 years, we never had special dividends. When we had a little bit higher rent increase, it was due to rather acquisitions and rather strong lettings, which changed a bit the curve. I think our policy is to be a very predictable dividend contributor. I would not exclude it because it is not in my responsibility, but I would expect a continuous development of the dividend.

Speaker #2: When we had a little bit higher rent increase, it was due to acquisitions and rather strong lettings, which changed the curve a bit.

Speaker #2: I think our policy is to be a very predictable dividend contributor. I would not exclude it, because it's not in my responsibility, but I would expect a continuous development of the dividend.

Speaker #4: Got it. Thanks.

Operator 2: Got it. Thanks.

Giacomo Balzarini: Got it. Thanks.

Speaker #1: Once again, to ask a question, please press star and one on your telephone. Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Giacomo Balzarini for any closing remarks.

Operator 3: Once again, to ask a question, please press star and one on your telephone. Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Giacomo Balzarini for any closing remarks.

Operator: Once again, to ask a question, please press star and one on your telephone. Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Giacomo Balzarini for any closing remarks.

Speaker #2: Well, thank you very much to everybody. For the inquiries, we'll be in touch in the next couple of days, and I wish you all a very good day.

Giacomo Balzarini: Well, thank you very much to everybody for the inquiries. We will be in touch in the next couple of days, and I wish you all a very good day. Thank you.

Speaker #2: Thank you.

Speaker #1: Ladies and gentlemen, the conference is now over. Thank you for choosing CarroSchool, and thank you for participating in the conference. You may now disconnect your lines.

Operator 3: Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

Operator: Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.