Quarterly results as per 30 September 2012

During the reporting period January to September 2012, net income excluding changes in fair value rose by 8.3% to CHF 122.5 million compared to the previous year’s period. At the end of September 2012, NAV per share amounted to CHF 77.22, 2.6% higher than at year-end 2011 (CHF 75.28), whereas a dividend of CHF 3.00 per share was paid mid of April 2012. NAV per share before deducting deferred tax liabilities grew by 2.2% to CHF 90.99 (end of 2011: CHF 89.02).

Press Release
for immediate publication

13 November 2012

Quarterly results as per 30 September 2012

PSP Swiss Property – Positive result development. FY 2012 EBITDA forecast confirmed, lower vacancy rate than originally expected per year-end.

During the reporting period January to September 2012, net income excluding changes in fair value rose by 8.3% to CHF 122.5 million compared to the previous year’s period. At the end of September 2012, NAV per share amounted to CHF 77.22, 2.6% higher than at year-end 2011 (CHF 75.28), whereas a dividend of CHF 3.00 per share was paid mid of April 2012. NAV per share before deducting deferred tax liabilities grew by 2.2% to CHF 90.99 (end of 2011: CHF 89.02).

Real estate portfolio

At the end of September 2012, the real estate portfolio included 164 office and commercial properties in prime locations. In addition, there were seven development sites and three individual construction projects. The carrying value of the total portfolio stood at CHF 6.101 billion (end of 2011: CHF 5.958 billion).

Early 2012, PSP Swiss Property decided to invest approximately CHF 26 million in a health spa on the grounds of the Lido in Locarno. Construction of the building complex, which is already let to an expert operating company, will presumably last until mid-2013. Furthermore, four properties were sold in the reporting period for a total of CHF 14.4 million.

The ongoing site developments progressed as planned.

Vacancy rate

At the end of September 2012, the vacancy rate stood at 9.2% (end of 2011: 8.3%). 2.0 percentage points of the 9.2% were due to ongoing renovation work on various properties: 0.6 percentage points related to the property on Route des Acacias 50/52 in Carouge. 0.5 percentage points came from the property on Laupenstrasse 18/18a in Bern. 0.4 percentage points were due to the renovation of the property on Aarbergstrasse 94 in Biel. The properties in Zurich West and Wallisellen (carrying value CHF 0.9 billion) contributed 3.9 percentage points to the overall vacancy rate. The remaining properties with a carrying value of CHF 4.7 billion (i.e. the total investment portfolio excluding the objects under renovation as well as those in Zurich West and Wallisellen) made up 3.3 percentage points.

Of the lease contracts maturing in 2012 (CHF 36.3 million), 84% had already been renewed respectively extended at the end of September 2012.

Interim results Q1 to Q3 2012

Net income excluding changes in fair value increased from CHF 113.1 million to CHF 122.5 million compared to the previous year’s period. This increase was mainly due to the sale of the arts space on the Löwenbräu site in Zurich and lower financial expenses. Corresponding earnings per share amounted to CHF 2.75 (previous year’s period: CHF 2.64). For PSP Swiss Property, net income excluding changes in fair value is the basis for the distributions to shareholders. Net income including changes in fair value amounted to CHF 215.5 million (previous year’s period: CHF 234.3 million). The decrease resulted from a lower appreciation of the properties at mid-year 2012 compared to H1 2011. Earnings per share including changes in fair value amounted to CHF 4.83 (previous year’s period: CHF 5.46).

Rental income remained stable at CHF 204.3 million (previous year’s period: CHF 203.9 million). Overall operating expenses increased slightly by CHF 1.5 million to CHF 41.2 million. Due to lower interest-bearing debt and a lower average interest rate, financial expenses declined by CHF 5.8 million to CHF 28.9 million compared to the previous year’s period.

At the end of September 2012, net asset value (NAV) per share was CHF 77.22 (end of 2011: CHF 75.28). NAV before deducting deferred taxes amounted to CHF 90.99 (end of 2011: CHF 89.02). It should also be mentioned that a dividend payment of CHF 3.00 per share was made mid of April 2012.

Strong capital structure, decreasing interest expenses

With a loan-to-value of 29.6% (end of 2011: 32.2%), the capital structure remains very solid. At the end of September 2012, unused credit lines (all committed) amounted to CHF 430 million, i.e. after bond repayments totalling CHF 290 million during the reporting period; currently, the unused credit lines amount to CHF 510 million.

Due to interest rate hedging transactions, PSP Swiss Property will continue to benefit from the historically low interest rate levels in the medium term. At the end of September 2012, the passing average interest rate amounted to 2.16% (end of 2011: 2.49%) and the average fixed-interest period was 3.8 years (end of 2011: 2.9 years). No bank loans will mature until 2015.

At the end of March 2012, the rating agency Fitch confirmed PSP Swiss Property Ltd’s rating with an “A-” and stable outlook.

Outlook 2012

PSP Swiss Property is confident about the prospects due to its well-established market position, its strong capital base and the high quality of its property portfolio.

The economic environment will be kept observed – in Switzerland, in Europe and globally. Even if Switzerland has been able to avoid the bigger problems of many Eurozone countries so far, the turbulences on the financial markets, the issues related to the international sovereign debt problems and the strong franc might adversely affect the country’s economy in the mid to long term. Therefore, PSP Swiss Property will stick to its long-term value enhancing acquisition strategy and conservative financing policy.

Based on the assumption of an unchanged property portfolio, the 2012 EBITDA forecast (excluding gains/losses on real estate investments) of “approximately CHF 235 million” is being confirmed (2011: CHF 232.5 million). A lower vacancy rate than originally expected of “less than 8.5%” is foreseen for the end of the year (previously: “approximately 9%”).

Concerning the sites and projects, the focus will be on two sites in Zurich, the Hürlimann site (conversion of the “Kesselhaus” to be completed by year-end 2012) and the Löwenbräu site, the Gurten site in Wabern near Bern, the new construction “Vorderer Sternen” in Zurich as well as the new project “Lido” in Locarno. The other sites are partly still in the planning phase.

Key figures

Key financial figures

Unit

2011

Q1-3 2011

Q1-3 2012

Δ in %1

Rental income

CHF 1 000

270 675

203 865

204 337

0.2

EPRA like-for-like rental growth

%

2.0

2.4

1.8

Net changes in fair value of real estate investments

CHF 1 000

325 068

152 816

119 309

Income from property sales

CHF 1 000

7 504

8 143

12 105

Total other income

CHF 1 000

10 337

7 842

6 265

Net income

CHF 1 000

403 994

234 268

215 446

- 8.0

Net income excl. gains/losses on real estate investments2

CHF 1 000

149 020

113 127

122 517

8.3

EBITDA excl. gains/losses on real estate investments

CHF 1 000

232 532

176 892

182 016

2.9

EBITDA margin

%

81.5

81.9

81.7

Total assets

CHF 1 000

6 050 916

5 803 060

6 181 066

2.2

Shareholders’ equity

CHF 1 000

3 268 894

3 087 741

3 537 842

8.2

Equity ratio

%

54.0

53.2

57.2

Return on equity

%

13.0

10.4

8.4

Interest-bearing debt

CHF 1 000

1 946 894

2 006 482

1 828 039

- 6.1

Interest-bearing debt in % of total assets

%

32.2

34.6

29.6

Portfolio key figures

Number of properties

Number

168

168

164

Carrying value properties

CHF 1 000

5 611 591

5 427 584

5 827 889

3.9

Implied yield, gross3

%

4.9

5.0

4.7

Implied yield, net3

%

4.2

4.3

4.0

Vacancy rate end of period (CHF)3, 4

%

8.3

8.6

9.2

Number of sites and development properties

Number

9

8

10

Carrying value sites and development properties

CHF 1 000

346 879

286 221

273 287

- 21.2

Employees

End of period

Posts

84

83

85

Equal full-time employees

Posts

77

77

79

Per share figures

Earnings per share (EPS)5

CHF

9.40

5.46

4.83

- 11.7

EPS excl. gains/losses on real estate investments5

CHF

3.47

2.64

2.75

4.0

Distribution per share

CHF

3.006

n.a.

n.a.

Net asset value per share (NAV)7

CHF

75.28

71.33

77.22

2.6

NAV share before deducting deferred taxes7

CHF

89.02

84.11

90.99

2.2

Share price end of period

CHF

78.60

81.70

85.45

8.7

1

Change to Q1-3 2011 or carrying value as of 31 December 2011 as applicable.

2

“Consolidated annual net income excluding gains/losses on real estate investments” corresponds to the consolidated annual net income excluding net changes in fair values of the real estate investments, realised income on investment property sales and all of the related taxes. Income from the sale of properties which were developed by the Company itself is, however, included in the net income excluding gains/losses on real estate investments.

3

For properties.

4

Equals the lost rental income in % of the potential rent, as per reporting date.

5

Based on average number of outstanding shares.

6

For the 2011 business year. Cash payment was made on 12 April 2012.

7

Based on number of outstanding shares.

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