Almost exactly a year ago, a challenging time began for us all. In the middle of lockdown, I became Chairman of the Swiss Prime Site Board of Directors. The social and political uncertainties brought about by COVID-19 have not made it easy to weather the crisis. For the management and Board of Directors, the wellbeing and safety of our employees and customers was our priority. Despite not being physically together, we created momentum and successfully coped with this extraordinary year. Swiss Prime Site ends the year with a positive operating result of CHF 762.3 million. Profit was CHF 610.4 million. The Board of Directors will propose to the 2021 Annual General Meeting a dividend of CHF 3.35.

At the beginning of the crisis, the entire Board of Directors held a weekly conference call with the management team. In early summer, we adjusted the pace in view of the slightly more relaxed situation. Swiss Prime Site’s management has successfully guided the core Real Estate business and the group companies Swiss Prime Site Solutions, Wincasa and Jelmoli through this period.

In the second half of 2020, the Board of Directors tackled Swiss Prime Site’s key strategic topics, taking into account the change in market conditions. They looked at issues around corporate structure, portfolio size and profitability as well as hurdles and opportunities for the business. Together with management, they developed a strategy based on the two strong company pillars – Real Estate and Services.

We are not seeking to materially change the size of the property portfolio from its current CHF 12 billion. However, we do want to increase profitability through targeted initiatives. This resulted in four strategic priorities. Firstly, the attractive project pipeline will continue to be implemented. This includes leveraging the potential of densification and land reserves as well as divesting projects, or parts of them, by way of «capital recycling». Secondly, the composition of types of use in the portfolio will be adjusted. The objective is to minimise risks and remain agile in the face of market changes. Thirdly, the portfolio will be actively optimised. This includes developing real estate or divesting properties and sites in less optimal locations in order to release capital. Fourth, vacancies will continue to be kept at a low level. These initiatives will make a substantial contribution towards further increasing the net yield of the core business and increasing the resilience of the portfolio in question.

After the successful divestment of Tertianum, the Services business will look at further honing its profile. The most important strategic decision here will relate to the group company Swiss Prime Site Solutions. The real estate asset manager will expand its business model to include fund products, thereby significantly extending its range of services. This strategy will result in significant growth. Wincasa will continue to press forward with the transformation towards a digital business model and will be able to significantly increase profitability once again in the medium term. At Jelmoli, a range of strategic options have been reviewed and measures defined to enable the group company to achieve a break-even result by 2023.

Five years ago, Swiss Prime Site started a process of renewal within the Board of Directors. My nomination and election, like that of other colleagues on the Board, has been the result of this process, which is still ongoing. We are pleased to propose to the shareholders at the forthcoming Annual General Meeting that Barbara A. Knoflach be accepted onto the Board as a replacement for Rudolf Huber.

I am thrilled to have been Chairman of such a dynamic and innovative company for the last year. It fills me with particular confidence that Swiss Prime Site is so committed to sustainability and is embedding this principle across different levels of the value-added process. An excellent example of this is the green bond, launched in autumn 2020. Both our business areas provide us with good long-term potential and a robust business model that remains resilient even in difficult times, such as those we have experienced in 2020. I therefore look to the future with optimism and confidence.

I would like to thank you, our valued shareholders, customers and partners, for your trust and support. My thanks also go to all employees and the management across the entire Swiss Prime Site Group.

Ton Büchner
Chairman of the Board of Directors

The past 12 months have strongly influenced our perception of the world. As a society, we have had to restrict ourselves and partially and temporarily give up freedoms we took for granted. This is in order to protect ourselves but also others. Agility and flexibility are two important virtues, especially in these times, to deal with changing circumstances.

Swiss Prime Site succeeded well in this in 2020. Despite some major restrictions, the company was able to continue working towards the goals it had set thanks to the adaptability of its processes and the open-mindedness of its employees. At the beginning of 2020, the group company Tertianum was successfully transferred into new hands. It was important that the approximately 5 000 employees continue to be employed by the new owner.

Especially in 2020, the commitment towards a range of stakeholders was fundamental, while protecting the employees was top priority. It is only by having highly-qualified experts that we were able to safeguard our business processes despite the altered, and significantly more challenging, circumstances. In addition, the Board of Directors and Executive Board decided to set up a solidarity fund to help those employees particularly affected by the coronavirus. In the first instance, this was intended to provide quick and effective help to Jelmoli sales staff, who were on short-time work due to the crisis and the prescribed closure of the premium department store, and suffered a loss in wages as a result. The fund was endowed with CHF 450 000 and was financed equally from the Board of Directors’ fees and Executive Board members’ salaries. It was also important to assist our tenants with personal and financial resources and provide them with as much support as possible during this crisis. Many hospitality companies, event organisers, retailers and independent businesses were severely impacted by lockdown and had to stop trading for a period. By offering payment extensions, rent waivers and individual solutions, Swiss Prime Site managed to help nearly all its clients.

The renewal of the executive committees within Swiss Prime Site continued. Since the 2020 Annual General Meeting, Ton Büchner has been the new Chairman of the Board of Directors. As part of the renewal process, the aim is to fill the announced vacant position of Rudolf Huber in the Board of Directors with a suitable successor at the 2021 Annual General Meeting. With Barbara A. Knoflach, the ideal candidate will be proposed to the Annual General Meeeting. At the Executive Board level, there has been a change in the leadership of the core real estate business, with Dr. Martin Kaleja chosen as the ideal appointment. Anastasius Tschopp (CEO Swiss Prime Site Solutions) joined the Executive Board from 2021, reflecting the future strategic importance of real estate asset management for third-parties.

Regarding compensation and incentivisation of the Board of Directors and Executive Board, several key plans were implemented in 2020. One of these was to conduct an external benchmarking analysis. This revealed that, in the context of the size and structure of our company, and in the real estate in­dustry, Swiss Prime Site is within the standard market range. In addition, amendments and clarifications to the management compensation regulations have been made. From 2021, clawback clauses will be introduced for members of the Executive Board. Regarding the compensation of the Board of Directors, the 10% discount for allocated shares has been cancelled and the blocking period has been adjusted from four to the standard three years.

When I write these lines again in a year’s time, agility, flexibility and responsibility will still be at the top of my list of priorities. Nonetheless, my wish for all of us is that we will have passed a bit of the «new normal» and will be able to pursue our tasks again with a little more ease.

Dr. Barbara Frei-Spreiter
Member of the Board of Directors and
Chair of the Nomination and Compensation Committee