Market Commentary January 2025

The new year began as the old one ended: euphorically. IMMO25 recorded a record number of visitors, confirming the strong interest in Swiss real estate investments. Many investors are hoping for further interest rate cuts by the SNB. As a result, real estate indices quickly rose by more than 3%. At the same time, asset managers aggressively announced several capital increases. However, investors are becoming more cautious with premiums exceeding 50%.  The year 2022 is still fresh in everyone's memory, marked by a significant loss of confidence that led to a 15% market correction. Despite a strong start to the year, the SWIIT Index closed January down 1.4%. The high capital demand could exceed investor appetite, similar to 2018. Additionally, the annual results of funds closed in September were disappointing: while rental defaults continue to decline, growth potential is shrinking. This makes innovation among asset managers crucial.  Moreover, indirect real estate investments continue to suffer from redemptions. The annual results of real estate stocks are particularly important for identifying the most active companies and promising sectors. A first market shake-up is expected at the end of February with the merger of Ina Invest and Cham Group, whose valuations are expected to be positive according to recent reports.  

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