(This story has been updated on 5 October to correct the valuation of the Cardiff property and add the reported asking price).
UBS has started multiple sales processes for properties in the 3.4 billion Swiss francs (€3.5 billion) Credit Suisse Real Estate Fund International.
However, the bank has denied it plans to sell all 53 properties in the fund, which it inherited in March when it bought Credit Suisse for 3 billion Swiss francs to prevent a run on the bank in a move orchestrated by the Swiss authorities.
“As the only Swiss-based global direct fund in the combined business, we see this being a key part of our future offering,” a spokesperson said in a written statement to CoStar News.
The denial came after multiple market sources said the Swiss bank has been looking to sell all 53 buildings, mostly offices, in the fund. The fund has also invested in five development plots. The bank is eyeing individual property sales rather than portfolio sales. CoStar News has identified a number of ongoing sales processes.
In Amsterdam, the bank has mandated JLL to sell the 19,515-square-metre MediArena office building. The property was valued at 75.2 million Swiss francs as of June 2023 and produced 2.6 million Swiss francs in rental income, according to the fund’s half-year report as of 30 June 2023. Credit Suisse bought it for 71 million Swiss francs in 2010.
In July, the fund manager sold The Corner office building in Rotterdam for €33.2 million (approximately 32 million Swiss francs at current exchange rates), according to a purchase agreement filed with the Dutch land registry. It had bought the property for 38.3 million Swiss francs in 2006.
In Cardiff, the fund manager has instructed JLL and Knight Frank to sell 5 Callaghan Square. The 4,905-square-metre property was last valued at 12.3 million Swiss francs and produces 521,3331 Swiss francs in income. It has a circa £10 million asking price. In Leeds, it is soft-marketing two of the three properties it owns in the city.
In London, Credit Suisse has been trying for some time to sell Earl Place at 15 Appold Street. It bought the 8,738-square-metre property for 58.9 million Swiss francs in 2010. It was last valued at 70.2 million Swiss francs.
In Leeds, Knight Frank and JLL have been appointed to sell two buildings: One Leeds City Office Park, a 5,234 square metre office last valued at 33.388 million Swiss francs, and 26 Whitehall Road, an 11,322 square metres office valued at 31.99 million Swiss francs.
In Stuttgart, Credit Suisse has instructed Colliers to sell two office buildings at Marienstrasse 50 and Silberburgstrasse 175, 175a and 177. The first property covers 3,567 square metres and was bought in 2021 for 11.8 million Swiss francs. The second measures 3,443 square metres and was bought for €10 million the same year.
The fund manager has discussed selling the five other properties it owns in Germany, said a source familiar with those discussions. They are in Berlin, Frankfurt, Mainz and Munich.
The fund has 3.2 billion Swiss francs of commercial properties and 1.4 million Swiss francs of residential properties. The commercial properties are in main cities spread across the world, from Amsterdam to Yokohama City. Offices account for 82.2% of the fund’s income, followed by residential (6.05%) and parking (5.5%).
During 2022, the fund produced a negative investment return of 6.76% compared with positive returns of 3.46% in 2021 and 0.78% in 2020.
UBS's emergency takeover of fellow Swiss banking giant Credit Suisse in March created one of the world's largest commercial real estate lenders and asset managers, and a series of immediate questions about the impact on the banking and property sectors.
Credit Suisse's ongoing problems of recent years, which included a long period of lossmaking as well as money laundering charges in Bulgaria, were exacerbated by the rising global interest rate environment and the collapse of the US's 16th largest bank, Silicon Valley Bank.
Credit Suisse received an emergency $54 billion lifeline from the Swiss National Bank first in a bid to reassure markets, but its shares continued to plunge.
Additional reporting by Luke Haynes and Dore Wilken.