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Investor Guide to Europe 2014
The Swiss real estate market is relatively sizable
and sits within the top ten in Europe, alongside
Russia and Sweden. Most activity is centred on the
cities of Geneva and Zurich. Institutions (insurance
companies and pension funds) and unlisted funds
tend to predominate in terms of holdings and
investment activity.
The Swiss real estate market has long been dominated by
domestic investors. However, for several years now, more
international investors are being attracted to the commercial
real estate market, evidenced by increasing activity in recent
years. Swiss law limits foreign acquisitions of residential
properties in order to protect the residential market from
speculation.
Switzerland presents five major submarkets for real estate
investments, namely Zurich, Geneva, Basel, lausanne and
Bern, as well as their respective suburbs.
The safe returns offered by the Swiss market are especially
attractive to core investors, but leveraged investors also find
it valuable for diversification and hedging reasons. Indeed,
total returns of direct investments are characterised by a
low standard deviation, representing a low risk and therefore
comparably low yields.
Market sizing
Switzerland
Europe
Invested stock*
(Total stock)
EUR 150bn
(EUR 185bn)
EUR 3,380bn
(EUR 8,150bn)
liquidity ratio*
(10y average)
0.5%
(0.3%)
4.0%
(4.5%)
2013 volumes
(10y average)
EUR 1.0bn
(EUR 0.5bn)
EUR 139bn
(EUR 135bn)
Investment activity by asset type, 2013
Source : DTZ Research
Investment activity by source of capital, 2013
Source : DTZ Research
Market pricing – Geneva (Q4 2013)
office
Retail
Industrial
Current Yield 3.50% 3.50% 6.00%
Min/Max
(10y)
3.50-5.50% 3.50-4.20% 5.75-6.50%
Yield
definition
net initial yield
Source : DTZ Research
SWITZERLanD
* 2012 figures
