Real estate has always been a cornerstone of wealth generation and preservation. Properties in ultra-prime locations maintain a stable value during almost every economic situation when aligned and managed properly.
The performance of private real estate is not closely correlated with public stocks, bonds, or funds.
Real estate assets, when properly structured and managed, are great to preserve capital.
Real estate can generate stable and predictable cash flows.
Quality opportunities are difficult to source, operationally intensive, and often burdened by high prices, misalignment, or poor performance.
Quantitative easing (money printing) has driven real estate prices to an all-time high and returns further down. The Le Bijou operating model for real estate has brought investors a real alternative for over a decade.
“Success has proven Le Bijou right: rates of return from which classic hotels and other companies can only dream of.”
Neue Zürcher Zeitung
Real estate is somewhat of a Jurassic industry. The market lacks innovation; thus, most investors “buy to let”.
The regular operational model leaves little room for competition and makes it nearly impossible to find an outperforming deal, as buildings are generally considered to be a commodity. As a result, most returns are within the same range and, due to the high inflow of capital in recent years, not really exciting.
Unlock the potential
Real estate offers unique benefits over other asset classes when aligned and appropriately managed, but the true potential is rarely unlocked by the current market players.
Most professional real estate investors, such as pension or real estate funds and REITs, are incentivized only by AUM (assets under management) and rarely by the performance of their assets. Because of this, real estate is often seen through the eyes of the old economy.
We look at real estate investments with fresh eyes and have created an operational model that has outperformed the traditional model for over a decade.
In recent years asset prices have gone up consistently while rental income stagnated or declined, making the traditional "buy to let" model inefficient for most investors.
Due to the inflationary or stagflationary economic environment, central banks have raised key interest rates. In response, mortgage lending banks have massively increased interest rates on mortgages.
However, due to the tenancy law, landlords cannot easily adjust their rents to the new market environment. Conversely, real estate is becoming almost unprofitable considering current valuations. Especially rural and suburban real estate assets are experiencing strong headwinds as the mortgage rates to refinance often exceed their current post-tax income.
“Having low fixed costs is an advantage in the hotel industry. Le Bijou can manage the cost pressure better than hotels that have to pay salaries for hundreds of employees.”
The graphs compare gross yields (without leverage) per year based on historic sqm prices in Switzerland. Le Bijou looks back on a positive track record of way over a decade.
Sources: Realadvisor, Moneypark, and Numbeo Property Prices Index by Country 2022
*The reference yield for Le Bijou was calculated by net operating income in comparison to the sqm price of real estate in Zürich, Switzerland (Post code 8001) per year
We have highly diversified income streams, all from different markets.
Short term hotel bookings
Our apartments can be booked just like a hotel, night by night. As our offering is in the premium segment, guests are ready to pay a 5* rate to stay at our properties.
Long term residential tenants
Instead of finding, furnishing, and decorating your own place, more and more high-earners decide to use "living as a service," which offers more flexibility and a fully managed lifestyle.
Corporate and private events
Brands and individuals enjoy meeting and spending time together. We are working for some of the most renowned luxury brands, private banks, and individuals who book a penthouse to celebrate.
We are happy to answer all your questions in a personal meeting or call. Le Bijou representatives are available for in-person meetings all over Switzerland and, upon availability, in Europe.
Schedule a call with one of our representatives to determine if a bond investment is right for you.