Commercial Magazine

International Investments: Switzerland

By Victor Whitman

Switzerland continues to be a top source of capital in sales of U.S. commercial properties. A longtime international center of banking and finance, Switzerland ranked No. 3 among foreign investors in U.S. commercial real estate after only Canada and Germany in the 12 months through first-quarter 2020, according to Real Capital Analytics (RCA). Switzerland ranked third in 2019 and sixth in 2018. 

Swiss companies were full or partial investors in 49 U.S. properties with total sales of $3.4 billion, RCA reported. Switzerland was the No. 2 capital source among European countries and represented 6.2% of the world’s capital inflow into U.S. commercial real estate deals from second-quarter 2019 through first-quarter 2020.

Swiss companies also bucked an overall trend by stepping up their activity in the U.S. Worldwide, foreign investment in U.S. properties declined steeply in the four quarters through this past March compared to the same period ending in March 2019. Swiss investment volume, however, rose by 4% year over year during that period. 

That being said, the COVID-19 pandemic dramatically changed the foreign-investment landscape in the U.S. As of this past July, the U.S. remained the epicenter of the global crisis, with cases rising steeply in several states. Many commercial real estate analysts expected significantly fewer property deals until the health crisis was contained. RCA said it was unclear how foreign investment would be affected. 

Prior to COVID-19, however, Swiss companies were involved in several high-profile U.S. sales in the 12 months through March 2020. The Zurich-based GMF Capital was the biggest player among Swiss companies and the 12th-most active foreign buyer of U.S. commercial properties during this period as it acquired 16 assets valued at more than $1 billion, RCA reported. 

In December 2019, the company partnered with the Saudi Arabian investor Riyad Capital to acquire a 1.1-million-square-foot office building in the Dallas area for $584.2 million. The building serves as the U.S. headquarters for Pioneer National Resources. A Florida-based investor later bought an interest in the ground lease for $218 million, according to news reports. 

Another Swiss investor, Partners Group, was involved in multiple deals totaling $892.5 million. The largest involved the $266 million acquisition of a 1.8-million-square-foot office park in the Charlotte suburbs that was once used by IBM. In that deal, Partners Group joined with Florida-based Accesso Partners on plans to build a hotel, residential units, retail space and additional office space.

In October 2019, the Swiss company UBP, in partnership with Boyd Watterson Asset Management, bought a 1.3-million-square-foot office building in the Washington, D.C. suburb of Rockville, Maryland, for $436 million. And in June of last year, Credit Suisse acquired a 29-story office building in downtown Austin for $309.7 million. 

Swiss health care company Roche Molecular Systems was involved in a major purchase in the San Jose metro area. In February 2019, Roche purchased the Central Campus office park in Santa Clara, California, for $140.5 million. ●


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