- Significantly oversubscribed capital increase and expansion of investor base in the first half of 2021
- Purchase of five attractive properties for commercial use in Pratteln/BL
- Real estate portfolio expanded by 76% to CHF 194.2 million
- Target rental income (annualized) of CHF 11.4 million as of June 30, 2021
- Net income more than quadrupled to CHF 3.1 million compared to the first half of 2020
- Total fund assets doubled compared to year-end 2020 to CHF 220.7 million
- High occupancy rate of 95.9% and WAULT of 7.7 years as of June 30, 2021
- Net asset value per share of CHF 115.52 as of June 30, 2021
Details on the first half year 2021
In June 2021, the Fund management company successfully carried out a capital increase of CHF 27.7 million for the HSO Fund and increased the real estate portfolio by more than three quarters to a value of CHF 194.2 million through the purchase of five properties in Pratteln/BL (31.12.2020: CHF 110.3 million; 30.06.2020: CHF 51.1 million).
As of June 30, 2021, the annual target rental income of the real estate portfolio amounted to CHF 11.4 million (30.06.2020: CHF 3.6 million). The occupancy rate remained at a very high level of 95.9% (31.12.2020: 99.0%; 30.06.2020: 98.2%). The fund has various long-term leases with key anchor tenants. Weighted average unexpired lease term (WAULT)* as of June 30, 2021 was 7.7 years (12/31/2020: 8.3 years; 06/30/2020: 6.9 years).
Income statement
Compared to the same period of the previous year, both rental income and profitability increased significantly. Tenant and building lease income doubled to CHF 3.3 million (H1 2020: CHF 1.6 million). It should be noted that the properties in Pratteln were added to the portfolio in May 2021 and have contributed a total of around CHF 0.7 million to rental income since the purchase. These properties will develop their full earnings potential from the second half of 2021. Net income quadrupled year-on-year to CHF 3.1 million (H1 2020: CHF 0.7 million).
In the first half of 2021, the valuation of the real estate portfolio by the independent valuation experts Wüest Partner AG resulted in an unrealized gain of CHF 8.0 million (H1 2020: CHF 1.8 million). Total income for the first half of 2021 amounted to CHF 9.7 million (H1 2020: CHF 1.9 million).
Balance sheet
The total fund assets of the HSO Fund reached CHF 220.7 million as of June 30, 2021, thereby also doubling compared to year-end 2020 (31.12.2020: CHF 111.6 million; 30.06.2020: CHF 67.0 million). After deduction of liabilities of CHF 92.1 million (31.12.2020: CHF 25.1 million) and estimated liquidation taxes of CHF 13.1 million (31.12.2020: CHF 2.6 million), the net fund assets amounted to CHF 115.5 million (31.12.2020: CHF 83.9 million). The change in net assets is the result of the distribution of CHF 6.00 per fund share in the total amount of CHF 4.5 million, which was paid out on April 29, 2021, the balance of the newly issued fund shares of CHF 26.5 million and the total income of CHF 9.7 million in the first half of 2021. The net asset value per fund share as of June 30, 2021 was CHF 115.52, which, taking the distribution into account, represents an increase of 9.2% compared to year-end 2020.
CHF 0.2 million in rent losses and provisions related to COVID-19
In the first half of 2021, rental losses and provisions of CHF 0.2 million were charged to the income statement in connection with COVID-19. This corresponds to approximately 1.9% of the annualized target rental income of the fund. The relatively low rate is due to the fact that the HSO Fund's rental income from the mainly affected non-food retail space comes mostly from creditworthy and larger tenants with group character. In addition, there were no tenant bankruptcies or legal disputes in connection with COVID-19.
Outlook
The Fund management company intends to further expand the portfolio in the current year and has an interesting property pipeline. In addition, the occupancy rate of the existing properties is to be further increased and early lease extensions achieved. In the fourth quarter of 2021, the fund company is planning another capital increase to continue the solid growth strategy.
1 The rent default rate according to SFAMA is imputed negative (-3%) as of June 30, 2021, because reversals of overstated valuation allowances resulted in earnings from collection losses. If rent reductions were included, the rent loss rate would be 3.0%. If the COVID-19 provisions were also included, the rent default rate would be 9.0%.
The semi-annual report 2021 of the HSL Fund is available on the fund management company's website and on Swiss Fund Data.
All press releases can be found under www.helvetica.com.
Zurich, August 31, 2021 - The Helvetica Swiss Opportunity Fund (HSO Fund) purchased five properties in Pratteln in the first half of 2021, expanding its real estate portfolio by 76% to CHF 194.2 million.
About Helvetica
Helvetica Property Investors AG is a leading real estate fund management company and asset management firm. We deliver sustainable value to our clients through active, long-term ownership of safe and stable real estate investments. With a fully integrated real estate investment platform, we are able to provide both standardized investment products and customized investment plans. We are proud of our longstanding reputation for outstanding client service and dedication to responsible ownership. Our firm is approved and regulated by the Swiss Financial Market Supervisory Authority FINMA.
About Helvetica Swiss Opportunity Fund
The HSO Fund is a Swiss real estate fund open exclusively to qualified investors. The HSO Fund invests in special purpose properties in the Swiss economic centers. The focus is on fully let properties with long-term leases and few tenants generating stable income. The investment objective is mainly the long-term preservation of value and the distribution of reasonable profits. The fund share units can be traded over-the-counter. The HSO Fund is approved by the Swiss Financial Market Supervisory Authority, FINMA.
Ticker Symbol HSO; security 43 472 505; ISIN CH0434725054
