02 March 2001
Real estate is not one of Swisscom's core businesses. Besides, new technologies and a reduction in both the number of jobs and the space required per job have reduced the amount of commercial space the company needs. This is why Swisscom has decided to sell some of its
properties and rent whatever space it still requires.
The contract for the real estate package went to a consortium lead by Credit Suisse Asset anagement (CSAM). The portfolio comprises 28 commercial and office buildings with a total rental space of some 380,000 square metres. Most of the properties sold are in city centres or urban agglomerations in both German- and French-speaking Switzerland and are suitable for rental. A high-rise block in Winterthur and the Fraumünster building in Zurich are among the items in the portfolio. Swisscom will rent approx. two-thirds of the rental space on leases with terms of up to 20 years. Over 20% of the space is already let out to third parties. The terms of the lease will enable Swisscom to react more flexibly to changing requirements. Its property management sub-sidiary, Swisscom Immobilien AG, will retain responsibility for the facility management of the properties.
Thanks to this transaction, major property risks have now been transferred to specialists on the real estate market while Swisscom is at liberty to make more efficient use of the properties group-wide.
Swisscom will invest the proceeds from the sale in its core business, for example in the con-struction of Switzerland's UMTS network or in fixed network-broadband technology and the spread of e-commerce.
According to the contracts signed on 1 March 2001, the purchase price of the real estate package is CHF 1.272 billion. Swisscom expects completion to take place in April 2001. The purchase price will be spread among the consortium members as follows:
CHF 706 million Swiss Prime Site (a listed real estate investment company)
CHF 256 million CS Interswiss real estate investment fund and CS 1a Immo PK real estate investment fund
CHF 214 million Winterthur Leben
CHF 96 million Credit Suisse Group (Switzerland) pension fund
The sale of a further 162 buildings belonging to Swisscom's real estate portfolio is already being negotiated. If these negotiations culminate in a deal, Swisscom can expect the two transactions to yield earnings after tax in the order of approx. CHF 500 million.
Berne, 2 March 2001