Mobimo Holding AG's investment guidelines define the principles and criteria that Group companies must consider when making investments
1. Amendments and adherence to the investment guidelines
The Board of Directors reviews the investment guidelines annually as part of its strategy meeting and may also adjust them to changes in market circumstances at short notice. Amendments will be published with due consideration to SIX Swiss Exchange's publication guidelines.
For every investment decision, adherence to the investment guidelines will be verified by the Real Estate Committee and/or the Board of Directors.
2. Real estate investments
Investment and development properties in Switzerland may be purchased as real estate investments. As far as the form of ownership is concerned, the aim will be to hold sole ownership in each case. Other forms of ownership or investments subject to leasehold are not targeted but may be approved by the Board of Directors in exceptional cases. The target regions set out in the strategy provide the basis for the regional focus.
2.1. Investment properties
- Investment properties are residential, business and commercial properties which have been purchased or constructed by the company as investment real estate with a long-term investment horizon to generate an attractive return.
- Business and commercial properties are properties in which more than 50% of overall usage is for office, sales and commercial activities.
- Residential properties are properties in which residential usage accounts for more than 50% of overall utilisation.
2.2. Development properties
Development properties are
- building land that has been purchased to develop properties or condominiums for sale to third parties or to construct investment properties for the company's own portfolio;
- properties which have been purchased with high vacancy rates and/or construction defects and/or in the absence of up-to-date usage for development purposes;
- properties from the investment portfolio which exhibit sustained vacancy rates of more than 10%. In the long term, such vacancy rates can only be rectified by implementing construction measures.
2.3. Other principles
Key criteria for the investment decision are deemed to be as follows:
- the quality and economic development prospects of the location,
- connections to transport routes and public transport
- the attractiveness of the location
- the architectural concept, the standard of interior fittings and flexibility of usage
- the letting rate or absorption potential as well as the solvency and structure of the tenants
- a return commensurate with the strategy
- the potential for increases in value and income.
In selecting the investment properties, the aim is to achieve diversification in usage to generate an attractive, stable and sustainable return from the investment portfolio with a ratio of
- around 30% residential usage
- around 30% commercial usage (services)
- around 30% business and other commercial usage (retail)
Investments in investment properties are generally made in properties with a market value (under IFRS) of at least CHF 10 million. When investments in development properties are made, a market value (under IFRS) of at least CHF 10 million is targeted once development is complete.
Investments are made in developments for third parties if a services income and an attractive return from the investment can be achieved.
Besides economic viability, all investments are examined in terms of their ecological sustainability and the aim is for the properties to hold nationally- or internationally-recognised certification such as MINERGIE, 2000-Watt-Gesellschaft (2,000 watt society), LEED (Leadership in Energy and Environmental Design) or DGNB (German Sustainable Building Council).
Mobimo may raise short- and long-term debt for up to 60% of the total value of the assets. On a consolidated basis, the following principles must be adhered to in borrowing:
- Consolidated equity amounts to at least 40% of total assets
- An interest coverage factor (EBITDA in relation to net financial expense) of 2.0 is not undershot
- Net gearing (ratio of net debt to equity) is maintained at under 150%.
Derivative financial instruments, in particular swaps and forwards, may be deployed to hedge interest rate risks. Derivative financial instruments should be used solely for hedging purposes.
(Effective 1 April 2013)