Quick Facts
- Prime locations: PSP Swiss Property owns office and retail properties worth CHF 10.1 billion in Switzerland's prime city locations.
- Strong 2025: Net income up 8.9% to CHF 408.5 million; portfolio appreciated by CHF 231.1 million.
- Vacancy on target: Guided 3.5% year-end vacancy and hit it exactly, recovering from a mid-year high of 4.3%.
- Smart repositioning: Selling non-core assets above book value, converting properties, and unlocking the Richtipark site in Wallisellen for up to 75% residential use after a successful rezoning.
Pros
- Prime-only, no exceptions. In a market where B-locations are struggling, PSP's discipline pays off.
- Rock-solid balance sheet. Low debt, a billion in unused credit lines, and a top Moody's rating.
- Dividend keeps climbing. CHF 3.95 per share for 2025, raised again and well covered by cash flows.
- Portfolio appreciating. Fair value gains show the assets are getting more valuable, not just staying stagnant.
Cons
- Underlying earnings slipping quietly. Net income without the boost from revaluation would have fallen for the second year running.
- Rental income stagnant. Total rents edged down slightly. Not alarming, but also not a growth story.
- No acquisitions planned. No additions to the portfolio in 2025, and management is openly cautious. Portfolio growth will be slow.
- Heavily Zurich-concentrated. 61% of portfolio value is in one city, with limited cushion if the Zurich office market softens.
- Stock is priced for perfection. Shares trade above net asset value, leaving little room for positive surprises.
PSP Swiss Property is back in the Obermatt Swiss Pearls Index (OMSP1) as of March 2026. The company had been removed in March 2024, when rising interest rates across Europe were weighing heavily on real estate valuations and PSP's ranking had fallen below the index's strict criteria. The business itself was performing operationally, but the broader rate environment made it hard for any commercial property company to score well on valuation metrics.
Since then, however, the macroeconomic situation and PSP's own performance have improved. The Swiss National Bank moved earlier and more decisively than most central banks, cutting rates several times and bringing financing conditions back to comfortable levels. As borrowing costs fell, property valuations recovered, and PSP, with its concentration in the most liquid and sought-after Swiss city locations, benefited disproportionately. The share price rose over 13% in the first half of 2025, outperforming the broader Swiss market, and with valuation metrics back in range, PSP meets Obermatt's criteria again, with an exceptionally high Obermatt 360° View.
Beyond the rate cycle, there is something worth noting about how PSP used the quieter period. Rather than pushing acquisitions in a difficult market, management stayed disciplined, selling non-core assets well above book value, reclassifying underperforming properties into development, and actively repositioning the portfolio for the next phase. The Richtipark rezoning, converting five office buildings into a mixed-use site with up to 75% residential, is the kind of long-term value creation that does not show up immediately in the numbers but matters over time. It also reflects a broader trend playing out across Swiss cities: the conversion of redundant office space into residential and mixed-use developments is gradually tightening supply in the markets where PSP operates, which supports rents and valuations at the prime end of the market.
For the OMSP1, PSP brings a specific kind of anchor: a pure-play Swiss commercial property company that manages carefully, pays a reliable and growing dividend, and owns the right buildings in the right Swiss cities. Those cities are structurally well-positioned for continued demand. Switzerland's population is projected to grow from 9 million to 10.5 million by 2055, driven almost entirely by immigration concentrated in the major urban centres. Zurich and Geneva in particular attract a disproportionate share of highly skilled, high-income workers: Zurich as one of Europe's leading financial and technology hubs, Geneva through its dense cluster of international organisations and multinationals. New arrivals such as OpenAI and Anthropic, which recently established offices in the Zurich area, point to continued demand for quality space in exactly the locations where PSP operates. That kind of tenant base is what protects against the hollowing out that is hitting secondary locations across Europe.
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