Good morning. Welcome to our media conference today. Same thing twice a year. One person is saying nothing, that's me, and then there'll be people who get up and say something, and we'll go along this usual line, René, and then Markus. Who's going to kick off?
Okay.
Okay. It's René.
Thank you very much, Hans Peter. Well, there was a slide for you skipped it. This was it, or this would've been it, I will cover it. Well, a warm welcome this morning at this media conference, strategy conference, particularly Luca Stäger, a warm welcome. He is joining us from Canada with a six-hour delay, early good morning, Luca. He is going to back for the important sales process, of course, he's on holiday at the moment. Let's start with the most important figures. Half yearly result. The real estate portfolio, 6% growth to approximately CHF 11.5 billion. We have grown in operating income too, due to growth within Tertianum to CHF 608 million. This is a 3.8% growth in percentage points. The rental income dropped slightly at 0.7% minus. This is due to the asset swap with Sihlcity, which we sold off.
Another factor is redevelopment, that are still ongoing, and so we're not generating any rental income yet. For example, the Stücki Shoppingcenter and the A1 retail park in Oftringen, and also the Messeturm, also in Basel, has some vacancies where Roche moved out, and we haven't been able to fill the space yet. By the end of the year, all of that should be much improved, and we should also be better than at the end of the year 2018. EBIT has grown by 22.8% to CHF 286 million, driven by revaluations. Revaluation, whether these are special effects or not, is open to interpretation. My opinion is that it is partly special effects. Of course, in those areas where revaluations come from the development business, that's a strategic factor. CHF 140 million come from development business.
That part certainly isn't a random special effect, but it's something that we've worked for. Earnings. Here we have this clear rise to CHF 357 million. Here we have a special effect, which is true special effect, which is the deferred tax liabilities, which were released. We also were able to increase equity ratio to 43.6%. Earnings per share has declined a little. However, 6.2% in weighted number of shares increased, so this has to be taken into consideration when comparing this to the semi-annual results of 2018. We also saw an increase in net asset value to CHF 68.64. This is an increase by 5.2%, and this is only the services segment included at book values only. Now, let's look at the details. Revaluation gains are shown here. Approximately a little more over 85% revaluation effects, and very likely split half on existing properties.
Here also Beethovenstrasse helped because we were able to get a better rent rate. This also is due to our work, and then approximately half from development projects. Vacancies 4.7%. That's a very positive result. We already said that this would remain below 5%, and that is being confirmed as we speak. Here, now, let's take a look at our core business. New and renewed leases, 61,000 sq m have been rented or leases have been renewed. This includes Lonza, 8,000 sq m at the Stücki Park. That's one of the docks. 80% of YOND areas and Schönburg in Bern, which is almost fully rented out already, even though it won't be ready for moving in until November this year. Divestments, we have sold a property in Geneva in the first quarter of 2019, and started the sale of Building A at the Plan-les-Ouates.
Building a project in condominium ownership. That is a new project, and that is being started in the next few days. There's also been an acquisition in a development area in Geneva called Praille-Acacias-Vernets. It's the largest area of the canton and City of Geneva. We managed to acquire a small property right at the center of the area, and it already has a net income of 4.5%. We are going to be able to acquire more in order to be ready for the development to come underway once the canton and the city have approved it. Now let's take a look at our project development. Wangen bei Olten has been filed. The building permits have been filed for approval. We have received some approvals for the Tertianum project in Richterswil and one in Monthey.
At Stücki Park and Weltpostpark in Bern, we have also been able to get some topping-up permits. Let's take a look at the project pipeline, our properties under construction. We still have CHF 2 billion. There's a slight shift compared with previous slides. We now have CHF 800 million under construction, CHF 900 million in development, and CHF 400 million reserves. This is a shift to the well-known slide. If you look at the second and the third line on your left, you can see the Tertianum building, which used to be part of the development project. Now that we have approved the building permit, they're being reallocated to the under construction category, and are therefore included in here. Here, there are just a few details on rental income expected.
On the left, Yond, 80% have already been let out, and we are expecting rental income of CHF 4.3 million per year once it's fully let. At Bern Schönburg, we already have a rental rate or letting rate of 95%. This is a mixture of the hotel, retail, fitness gym, and also some apartments. On the 1st of November, it's going to be ready for moving in. The hotel is going to start in January. The West-Log Zurich is a logistics building, 85% let already. At Schönburg, by the way, it's CHF 5.4 million, CHF 4.3 Yond, and CHF 5.4 Schönburg, and CHF 3 million West-Log in Zurich. Those are the rental incomes projected. Here you can see the Plan-les-Ouates project. As you know, two buildings were sold. Buildings C and D were sold to the Hans Wilsdorf Foundation.
We are now selling these floors in Building A. At JED, in the old NZZ printing building, JED in Schlieren, 70% has already been let. We are expecting considerable rental income here too. First phase has started at Stücki Park, too. The first phase has started, the first two buildings. Rented let to Lonza, CHF 5.3 million per year. Let to Lonza, the entire building. Some new projects for assisted living. Monthey on the left and Richterswil on the right. CHF 1.2 million in rental income and CHF 1.9 million in rental income, respectively. In Monthey, 28 apartments and 50 beds, and Richterswil has 26 apartments and 54 beds. It's always more beds than apartments. That means that it's more of a service center. This is important because the beds are usually filled immediately.
Usually, we can achieve a let rate of about 95%, and then the apartments will usually come afterwards in terms of being rented out. Now, here are the projects in planning. The blue color. As I already said, two projects have now been transferred to the under-construction category that used to be in this category. Now we have a new slide, which is set to help you get some orientation. Planning business is our core business, which is why we are presenting this. We hope that this slide gives you a good idea of what's going on and where we are. I'm starting on the left, another Tertianum project in Lugano. Here we are in the design plan phase. We have already filed for approval, and a building application has been submitted, and we have a pre-letting status of 100%.
The beds have been let, the apartments still need to be let. In Olten, we have the new building. We have already published the design plan, we still have to make some changes before we can start with the building application. Again, pre-letting status, 100%. In Pont-Rouge, there is a new interesting development area next to the Praille-Acacias-Vernets, by the way. We have submitted building application. We are expecting it to be approved this year, we could start construction next year. JED, this is the development of Schlieren on the former NZZ property. We are already negotiating some prelets before submitting the building application. Stücki Park II already has received building permits, we are now going to construct Docks 2 and 3 just before the second building of the first phase has been let.
That will mean having let out 50% of the buildings, and that will trigger the second phase. This year we are starting here at the Maag site with an architectural competition for the additional smaller tower. It's important to have a competition here because we want to have top quality, and we also want to give different architects a chance to show their solutions and choose the best one. Long-term planning also includes another project in Geneva, near the airport. You may have heard about the airport in Geneva being quite complex. Riantbosson and the other project near the airport in Geneva has been very successful. 90% pre-letting status. Also with this projected construction, we can also expect excellent demand. Now, let me talk about the services segment now. Starting with Wincasa. The assets under management have shown excellent results.
First time we exceeded the CHF 70 billion mark, and the growth in the area mixed-use site management has been excellent. I think our clients appreciate the one-stop-shop for services, and that is something that we often hear when we talk to our clients. We are also working on transforming operation into a digital environment. This doesn't just require the infrastructure to be in place, but also the organization to be adapted to it. That means that we have people responsible for core business operation, but also we have key people for the transformation into the digital world. Markus Meier, our CFO, will tell you that we have an EBIT margin of 10% at the moment. I'm looking at Oliver Hofmann here. We projected 12% EBIT margin, which we're going to achieve. Oliver is nodding. We will achieve the 12% by the end of the year.
This is due to the fact that we have a cyclical business. For example, the bills cannot be invoiced until the end of the year. That means that some of the income is not generated until the second part of the year. Generally, we were able to open two watch boutiques, Breitling and Hublot. We are now converting the beauty department in the basement. Everything is going to become much easier for people to find their way around. The Palace Clinic is going to be opened in September with around 900 sq m. We're all looking forward to that. Our assets under management are slightly better than in the second half of 2018. You may wonder whether you can assume that this is going to continue in the same way until the end of the year. Well, yes and no.
We're going to start with The Circle investment. That's the interior construction. There is going to be some additional costs in the second half of 2019 and first half of 2020. Well, in terms of the Jelmoli, I don't just want to read all these titles, but I would like to take this opportunity to thank Frank for seven years of doing an excellent job for the Jelmoli. I think everyone will agree with me that we all wish you the very best for your future career and endeavors. Thank you very much for your great work. For the future head of Jelmoli, we have prepared an excellent team and well-positioned department store.
Also working in one of the most beautiful properties of the City of Zurich, a newly opened branch with the Palace Clinics, and a new beauty concept which will be presented in November, with a new ground floor area and the potential of opening areas near Zurich Airport, not until the autumn 2020. We've had to move the opening from spring to autumn 2020. Ultimately, also a successor of the CEO of Jelmoli will also have the opportunity to work on the opening of the online shop. This is a very exciting task. This is the official opening on our quest for a successor. Now, with Prime Site Solutions, we are very proud to this young new segment. The assets under management have increased by an impressive 48.5% to CHF 2.2 billion.
We have been able to acquire two real estate packages in the first half year. The rental income from them have managed to offset the lack of rental income from the previous ones. Really well managed. A capital increase was carried out in the first half of the year, and we are expecting a fifth issue in the second half of this year to be launched. There's also a strong increase in profitability for Swiss Prime Site Solutions. Well, now the particularly interesting topic of services. What's the status of Tertianum today? We now have 78 sites in 16 cantons in Switzerland. A lot of new sites have been added. This is an image of the 30th of June this year, and we are expecting a total turnover of CHF 5 billion this year, EBIT of over CHF 30 million.
We have 4,700 staff now, 3,323 care beds, almost 2,000 apartments for assisted living. You can see the growth phases that we've gone through. By the end of the year, we are going to have approximately 80 operations and we'll be able to continue our growth course based on our own development pipeline to approximately 100 operations by 2024. You may wonder why we are selling Tertianum. Well, let's talk about what we're selling. We're selling the operative business. We're not selling the properties in our portfolio. We're simply selling the operations. Now, let's take a look at 2013, which is when we truly started in this sector. What was our motivation? We wanted to grow our core business, and we were interested in Tertianum's real estate portfolio. These were 12 properties that we were able to acquire and 11 rented properties.
This opened the door for us to implement growth in the core business in an area that we wouldn't have been able to enter without the operative business. We were able to open up a new usage segment, which was assisted living. In the following years, we had a sharp growth rate from 23 to 80 operations. This was mainly due to acquisitions of SeneCura, ORPEA Group, and as French-speaking citizens. We didn't just grow, but we also managed, and I'm talking here about the Tertianum team, not just SPS, but the operations team, managed to make Tertianum ready. We invested in processes, in training care workers. We introduced SAP Care Coach. We managed to decrease the vacancy rates of care beds and apartments. We now have an EBIT margin which is very competitive.
We believe that for the last six years, we were the right owner at the right time for this great growth phase. As I showed, we could now continue to grow to 90 to 100 operations, and particularly, because we have our own development pipeline. What we cannot manage is to generate additional synergy. This applies to synergy potential within the group, but also outside. For example, purchasing materials, care materials. I'm sure that there are possibilities for procuring more cheaply. We're just not equipped for it. Also, we are not able to expand the value-added chain of Tertianum, but maybe other owners would be able to do that. In other words, the first reason is we were the right owner during that phase, but now in the next phase, another owner would be more suitable. That's the first reason.
The second reason for the sale is that the negative interest environment, which we are expecting to continue for a few years to come. This means that our core business, real estate, can only generate a limited growth by acquisitions, particularly not in the sites that we're interested in, simply because properties are too expensive. That is why we decided on concentrating on development business. Of course, you need a lot of cash for development, and we've always been able to cover this need with capital increases. The cash influx from selling Tertianum is going to allow us to finance future growth for the next business plan years. That would be the next three years, 2020-2023, without capital increases, which means that we would not water down the existing shares anymore. That's a like-for-like basis.
Of course, we don't know what other opportunities the future holds. That was the second reason. The third reason is that selling Tertianum is going to strengthen our balance sheet. The fourth reason, and let me explain this. We've been told very often that we're very complex. Markus Meier and myself were told that during our roadshows again and again. I think the dynamics of calculated risks is part of this company, and that also means choosing the right time to bid part of the business farewell when we feel that we have made enough profit with it. We're going to sell this operating, but I don't really like talking about complexity, though. It's simply going to give us more scope. More scope for concentrating on our core business, real estate and related areas, both in terms of time and in terms of finances.
Those who've been criticizing us, I hope that you will now see us more favorably, and I hope you're not going to disappoint us. That was my introduction, and now it's over to Markus Meier.
Thank you very much, René. Ladies and gentlemen, I will now guide you through the financial aspects of the 2019 half year results. Let me give you some important information. First and foremost, we had growth in various areas. As far as rental income is concerned, we've been stable compared to earlier years, with a clear prospect for further rental income from completed real estate development beginning in Q4 this year and moving on as we go forward through completion. We're planning for strong growth in assisted living with Tertianum. We have growth for real estate services with Wincasa, based on construction and property management fees. We have had strong growth for asset management for third parties with Swiss Prime Site Solutions and Jelmoli, in a challenging retail trade setting, was able to increase EBIT.
Let's have a look at the details, beginning with the main source of income, i.e., rental income, which has been stable compared to the period in the previous year. There have been some swings, obviously. For instance, our rental income was adjusted by CHF 6.4 million due to sales. On the other hand, we had purchases, and rental income was increased by CHF 8 million as a result of that. There was a difference of +1.6% between the two. For adjusted rental income of CHF 1.4 million, the main reason was the swap of our 24% share in the Sihlcity Shopping Center versus a 49% share at the office building in Worblaufen, where we control by 100% now, and two well-placed office properties in Zurich at Giesshübelstrasse and Müllerstrasse. Furthermore, we made medium-sized purchases in the retail field.
We reduced our exposure in Bern, Bahnhofplatz 9, at the end of last year, this year in Geneva at Rue de l'Equateur, very close to the Rue du Rhône shopping mall in Geneva. We gained rental income from the three properties in the asset swap on the one hand, but also from Beethovenstrasse in Zurich's central business district, a well-kept office property that we bought at a challenging return a year ago. The market has continued to develop, and it's very gratifying to see that there's been an increase in value that we posted in the first half year of 2019 on this very property. CHF 1.8 million of value adjustment on the portfolio of investment properties due to the Messeturm in Basel, where the major tenant moved out. As mentioned before, we are negotiating with interested parties. Negotiations seem to be promising.
Based on this situation in Basel with the Messeturm, we had a like for like of minus 0.8% attributable to this very situation. We had minus CHF 2.8 million of temporary reductions of rental income due to major repositionings, more or less the same ones we had at the end of 2018. First and foremost, the shopping mall on the Stücki Park site in Basel, where we've been moving away from a shopping center towards a more lifestyle shopping, enriched with entertainment, medical office, sports. We're going to convert it along those lines, and we've come a long way in doing so already. Another property in this field that we have temporarily taken out of rental income is the former A1 shopping center at Oftringen, which we're going to reconvert into a DIY market with a long-term rental agreement that was already signed by BAUHAUS.
We had eight sites that were vacated at the end of last year by the OVS Group in Switzerland, fast fashion. At Christmas 2018, we had rented, let out all the eight properties at higher income. These properties at Bahnhofstrasse in Basel will no longer be in fast fashion, but it will be converted into a banking outlet. We have income from completed properties with more to come on a major scale as we are going to see later on. That's the two properties mentioned before in Geneva, around the Geneva Airport, the Geneva Business Terminal, and the Riantbosson properties, both of them fully let by now. Finally, due to additionally leased properties in assisted living, we ran a CHF 0.7 million of additional rental income.
On the left-hand side here, you can see the top-line situation, operating income, and in middle, at center, EBIT divided into real estate services, the two segments. You will find the details on the services segment below that. Beginning on the left with growth top line. In both segments, we grew, as you can see. In dark, we've got real estate. Here we grew primarily as far as income from development properties is concerned. We've got two complexes in development that we've already sold. We will generate income as a percentage of completion by 2021. This refers to the Plan-les-Ouates properties and three residential properties in Bern at Weltpostpark. Much for the increase in real estate. For services, we rose by CHF 17 million or 4.3%, CHF 12 million in the field of assisted living.
That's the growth story we're seeing here, CHF 5 million in particular for asset management for third parties. Following reorganization in the past year, we are now generating these fees. This leads to EBIT of CHF 286.1 million in the half year, 92% from the core business of real estate, the rest of it divides into what you see at the bottom, strong growth with Tertianum, as we saw at the level of the top line. Wincasa, we've got top line growth, as a matter of fact. However, we are very much in the phase of transformation there. We are getting fully digitalized, and we are focusing on moving towards a digital business model. We've set up an innovative call center for the most essential 20-25 questions that people ask. This will take more investment.
We have not completed it yet. Of course, this leads to a charge on EBIT this year and last year for Wincasa. The assets under management, CHF 75 million of assets under management threshold has been passed, and that's a result of our expansion in this field. Jelmoli, in a challenging environment, improved on EBIT. As René Zahnd mentioned, we are assuming that based on the investments that we are to make with the aero project at the air site, at the airport, and the two formats Circle and where we have some construction delays. Due to general digitalization and e-commerce in particular, e-commerce will be linked up with stationary trade. With all the gadgets, such as social media, will be integrated, and this will certainly be a major charge at EBIT level.
Swiss Prime Site Solutions rose from 1.6% to 2.1%. I think that speaks for itself. Here you've got the group income statement with the operating income that we've just talked about. Revaluation of investment property. There's a strong increase over the previous year, triggered by the high quality of our properties and the quality of our sites and demand from the market. At the end of the day, we need to mirror market value for the prime sites. This is divided more or less 50/50 among investment properties and development properties. What is very gratifying to see is that in all developments under construction, we have a positive revaluation gain.
This applies to all the properties, Zurich, JED, and YOND, and the two projects in Geneva, Espace Tourbillon and Pont-Rouge, and Schönburg at Bern, as well as Stücki Park at Basel, specifically the finger docks on the Stücki Park site. The market-weighted average real discount rate reduced to 3.17% by 5 basis points, or in nominal terms, 3.69%. We've got sales proceeds on investment property in the amount of CHF 5.6 million. That's the sale of Rue de l'Equateur retail trade property. You always have to add the gains that we made over time due to POC on the development projects sold. That led to the proceeds in the real estate segment that I mentioned. We have a total of CHF 12.6 million for the half year of proceeds from properties sold.
Operating expenses also increased due to the developments on percentage of completion, but in particular, due to the growth of Tertianum assisted living. This is a business that requires a lot of HR as well as maintenance and depreciation. Headcount at the group as of 30th of June rose to 5,200 FTEs, up from 4,900 a year ago. Financial expenses were slightly decreased. We were benefiting once more from a yet lower interest rate setting without changing our financing structure though. Very special thing to mention in this first half year is the tax expenses.
They're usually expenses. Here we've got a tax income for this half year because the Swiss people on the 19th of May, 2019, voted on STAF the tax proposal and social security financing, approving this proposal, and various cantons have dramatically lowered their corporate tax rates as a result, primarily in the canton of Geneva, but also in Basel City and St. Gallen. We've benefited from massive tax reductions, as a result of which we had to reverse some of our deferred tax provisions in the amount of CHF 158 million. They're still at CHF 1.1 billion of total deferred tax provisions that we have on the books. This is non-cash, of course. The origin of this contribution is completely outside the control of Swiss Prime Site and does not affect the business at all.
This is why profit rose tremendously from CHF 151.3 million last year to around CHF 356.5 million. For reasons of transparency, we always showing this without revaluation gains and deferred tax. As announced, we are at a stable level compared to the previous year. Here, you have the development of the real estate portfolio from a purely financial point of view with the sales we conducted in Geneva, the retail trade property, and the two major value increases on the portfolio, both like for like and for projects. This increase in value is composed of investments and the CHF 85 million divided into the two components of revaluation gains, as shown before. We bought this small block of lands, future development block of lands in the PAV site in Geneva and a medium-sized property for assisted living. This is a solid capitalization based on equity.
Of course, the strong increase in profits over the half year reinforced our capital base, and we can also see the shareholder-friendly payout we made in this half year. We are within our target corridor of around 45%. As far as financing or credits are concerned, we continue to have an average volume weighted funding ratio of 1.4% and residual term to maturity, 4.3 years. One major transaction that we completed in the first half year, a CHF 350 million straight bond at 1.25% coupon for eight years, and we have refinanced a CHF 200 million bond due in December early on. This is our strategy to refinance as early as possible. The loan-to-value ratio is within our corridor, around 45%. Much as far as finance is concerned. Let me hand it back to René Zahnd.
Thank you, Markus. Let me move on with the outlook or confirmation of our goals. This is the first half-year, I'm not going to give you a major outlook on the market. We'll make a few short statements. Geopolitical risks are not going to decrease. Trade war, U.S., China, what impact is it going to have? At the moment, it looks like having a positive impact for real estate companies or funds. We continue to expect low interest rates or even negative interest rates. You've heard it several times over. This is not necessarily negative for our business. For the office market, depending on how geopolitical risks are going to evolve, at the moment, things are running well. We can feel it. In the right places, the office market is doing well. Zurich is a good place. Geneva is a good place, too, involving different potentials. It's always a matter of microlocation, of course.
We can see potential in the field of logistics. There are some logistics centers in the project pipeline, as you can see. For the retail business, it is fair to say the wheat is separating from the chaff. On the one hand, as far as product is concerned, and on the other hand, as far as service quality is concerned, in particular, A Prime Sites doing well, continue to do well. We showed that with the OVS sites that we occupied again. It will be interesting to see how inner cities are going to evolve. The eight OVS sites were occupied with one single thing. I wasn't really aware of the concept of fast fashion. All I knew was there was fast food, but I really like fast fashion. There's only one site where we're offering fast fashion.
On the other sites, we have banks and dentists and things like that. This goes to show that good retail sites can be used for different purposes, producing high rental income at the end of the day, as the OVS example shows. These are the points to be borne in mind. Product, service quality, and the right place, the right site. The vacancy rates, I've already mentioned. Tertianum objectives, I've mentioned as well. We're going to achieve the goals set there. We will be able to make appealing payouts in 2020 with retroactive effect on 2019. On the left-hand side, you can see the growth potential we have for the development pipeline. Most important component there is rental income. There is a total of CHF 83 million that we expect from the pipeline. I'm saying that this doesn't include potential from reserves.
It only includes specific things that are under construction or in development. The reserves, land reserves, are not included here. There's a total of CHF 83 million rising in the years to come. Unfortunately, we only have CHF 1.1 from the two projects of YOND and Schönburg this year. Why so? Because they will go back to the portfolio only by Q4. There's going to be nice increases of CHF 15.8, CHF 17, CHF 14, CHF 15, CHF 19. Always between CHF 14 million to CHF 19 million of rental income every year. Much for the outlook and confirmation of all the goals and the outlook for rental income from now to 2024. We will keep you up to date. Even if there's a project that we were to sell, it will be mirrored. As a consequence, rental income would perhaps go down, but then we would have to post proceeds from sales as a result. I'll be available for questions, but hand it over for the Q&A to Hans Peter Wehrli.
Thank you very much for these presentations. We're now ready to take your questions. Let's start over here.
Thank you very much for your presentations. I have some detailed questions. The first question concerns Tertianum. Probably not a surprise that I'm asking about this. What's the duration of rental contracts going to be in the first half of 2020? Are you also considering changing some of the rental contracts?
No, we're not considering any changes to rental contracts. Most of the contracts that we own are not going to be changed. They're long-term, 20-year contracts, more or less.
The average now, maturity is now 15 years.
Yes.
Thank you. You spoke about additional cost for Circle, for Jelmoli in the second half of 2019 and beginning of 2020. What's the quantity? Spoke about when Jelmoli should reach the zero. Originally, the target was 2020, but that would have required us to open in the spring of 2020. If we'd done that, we would have invested into interior design in 2019. Now the plan is to achieve the zero in 2021. We still have some investments to make, which are going to have a negative effect on EBIT. The quantity is going to depend on a few factors. I can't answer that yet. Your question was when the equal would be achieved, and that is now going to be a year later than originally planned. Thank you. Just to get an idea of the market, Peter, in terms of rental of buildings under construction, have you made any concessions to future tenants? Have you had to, or?
I'm going to talk about Schönburg. I live
Very close, 500 weeks to date. Well, the question should really be whether we should have gone up with our rents, because now 132 apartments have already been rented out, and there's just 10 lacking. Those are the 10 that maybe don't have the ideal layout. As a basic principle, we certainly achieved the level that we were aiming for the hotel anyway, and retail is food retail. Yes. Now I'm going to pass over to a specialist in Zurich. Well, in YOND, we did not make any concessions. It was interesting to see that YOND had to be understood by the market.
It was a new product, and we gave our tenants a lot of freedom, and we saw that they had to be able to cope with that freedom because they had a lot of scope on what to do with the surfaces, with the areas. That's why we waited a little, didn't try to speed things up by reducing the price. We asked for the CHF 260, and we were able to get that. It may have taken a little longer than expected, but we now have 80% just before completion, so I'm very happy with that. Were there any contributions for interior design, et cetera? Well, sometimes, three months, mostly. Just two brief questions. Well, like for like growth ex Messeturm in Basel, well, relatively flat.
On slide 28, you gave an outlook to the future rental income, and it says here in the small print, in full rental. Should we expect full rental rates, or are you going to have the usual vacancy rates? Well, yes, we are expecting full rental, but of course, the question is how long it's going to take. May take a year before full rental is achieved, but that's always a relative question of what full means. Well, Peter said this correctly. The question was how to evaluate the intermediate floors, how to divide the rent between the mezzanine floors and the others, and what makes sense for the market. I have a question on the yields, which are in the business report, the 5.8% for the two projects. These are net yields, and those include a 4% vacancy rate.
This is the net yield. Next question. Some follow-up questions. Tertianum first. Maybe you can give us a few more details on who the potential buyers are. We're not going to comment on that. Maybe a question about the financial figures. No, we're not going to comment on that, neither on the potential buyers nor on the finances. Okay, on the margin. When I say that we're not going to comment, we're not going to comment. The margin increased by 130 basis points. Was that driven by operative improvements or investments that have now been discontinued so that you achieve the 5.7% of the EBIT margin? You're talking about Tertianum only. Well, this is due to operative results. This does not yet include the startup costs. It always takes a while for new operations to get into full swing.
This is operative results due to process improvements, Oral Care Coach, also getting the yield up. Costs, of course, is part of the operations. The care beds and the apartments have to be filled. The team managed to do that. Well, it's good management. It's very simple. More beds rented out, and that increases the profitability. That has nothing to do with the idea of selling. That's just good process management. Maybe another question on Jelmoli, maybe. These development costs for interior design, are you going to take that over completely, or is part of it paid for by Zurich Airport? Yes. Part is going to be paid for by Zurich Airport. We have concluded a contract, and so the question is on how much we will invest on top into the interior design. Thank you. Thank you.
Question on like for like. Is that something that you, well, in terms of the contracts that are going to be renegotiated in the second half of 2020, are you going to try and achieve flat like for like? Yes. Well, due to the situation in our markets, we expect a flat development. Well, the tax effect was very good. There are now also discussions in the canton of Zurich in terms of some changes here. What do you expect the effect to be for you? Well, in Geneva, in the canton of Geneva, there was a reduction from 24% to 14%, and that's certainly not the kind of reduction that we can expect in the canton of Zurich. Well, there are various opinions, and we think that the scope, or the expectation of tax cuts is relatively low.
Which is a shame, of course, because this would give us quite a lot of leverage here. Well, we're not expecting really anything, in terms of tax cuts in the canton of Zurich. Because even if the vote is accepted, the canton of Zurich still has one of the highest tax rates. I spoke to Mr. Stöckli, and the expectations should not be raised here. Is there any news on Oftringen? There was a discussion about selling the property. In Geneva, you also sold a retail property. Are there any plans to reduce the retail share in the next 12 to 18 months? We've already reduced the retail share a little. We are currently reassessing our retail definition because some of our tenants are not even retailers anymore. The question about A1? We're testing the market here.
It could be an option to sell it, but it's not necessarily the best solution. It's fully rented, particularly Bauhaus, a DIY market. The building, we could keep the building too, but it's a good moment to test the market, and if we got the right price, of course we could consider selling it. We can't really say. The retail share is going to generally drop. We were at 33% a few years ago, and now we're at 28%, and maybe in a few years we'll be at 25%. Of course, it's a question of quality. Retail is not the same as retail. A 25% would also be okay if it's the right retail. I have a question concerning Espace Tourbillon. Investment costs have been reduced to CHF 180 million. Before it was CHF 232 million.
Is that just due to the one building, the residential floor? Yes, that's correct. Well, that's not necessarily what you'd expect. Maybe you can give us an explanation. Why is it suddenly attractive to have a residential floor in an almost purely commercial sector? Condominiums are only the form of property. We've noticed that a lot of commercial operations have to relocate. When looking for substitutes, they find it difficult, particularly when they want to reinvest in order to save on capital gains tax. That was a gap in the market that we discovered. We saw that there was a demand and therefore decided to go for it and split the property into various condominiums and separate floors. This is simply adapting to the needs of SMEs.
Well, in the large development area that we mentioned earlier, some of the businesses have to move out, and they now have the building property by Geneva. These are commercial operations. Understand. Usage is going to be commercial anyway. Yes, of course, it's going to remain commercial, so it's not a change. I know that you don't want to comment on Tertianum much, but I have two questions anyway. First of all, how are the contracts going to be handled? Now, if a new owner comes in, there are existing rental contracts and you're still building new buildings for the new owner then. What's the contractual arrangement going to be about who's going to have which shares? How will Swiss Prime Site shareholders know what they will be the owners of. Second question, you already mentioned complexity as an argument for selling it.
Now, if I understand you correctly, that means that the remaining three business areas are considered core business areas, and that we're not to expect you to sell off any other business units.
Let's begin at the back. We are not talking about selling other units at the moment. For shareholders, with regard to real estate, there will not be any changes. We continue to be the owner of the real estate. With the new owner of Tertianum, we are going to have a rental agreement. That is my pragmatical view of things. The shareholders will take part as they are taking today in the real estate. Of course, the rental agreements of Tertianum, the 16 properties that are owned by Swiss Prime Site, these are rental agreements agreed at arm's length. For the other 62 rental agreements, we know what third parties would conclude. It is entirely at arm's length, and a potential buyer would have no reason to doubt these rental agreements. They are in agreement with the market conditions, no problem.
We clearly defined what was contributed by the owners and by the tenants. For a third-party buyer, it would be no problem to identify their position as the buyer. Thank you very much. Further questions? Yes, please.
Andreas Brunke from Credit Suisse. On chart 28, there was a small update on the increase of expected rental income from the pipeline. Is that due to the Tertianum construction permit for 2020, 2021, or what is the reason that these figures are slightly higher? 2021. The 83 million, we've shown that in the annual result. The 83 million will remain 83 million fundamentally, but there may be a shift over the years. The question is, when is a permit coming in? When will we be able to complete a building, and when to market it? There may be a shift in time.
This is our best guess that we are indicating here, but it's subject to ongoing review or adjustment. A question on your future tax rate going forward, looking into 2020, 2021, and future years. Can you give us any guidance now, having seen the first half year? Even following realization or implementation of the tax proposal and holding privilege, we will assume that we will keep operating at the same level. Maybe our tax rate will slightly increase or improve, but there's also negative effects since we have to adjust our financing structure due to the holding privilege situation. Final question on SPS Solutions. The level that we saw now in the first half year, is that sustainable with a view to the future? We expect it to be sustainable. You cannot simply double the half-year EBIT.
I think that was probably the core of your question. There are running fees on the one hand. Running fees are going to increase when assets under management rise. The profitable business, of course, will be sales and purchasing commissions, and that depends on the point in time you have acquired a portfolio. We are fortunate enough to have acquired two major portfolios in the first half year. I would have preferred to have one of them in the past year, one of them was in December, closing was on January 3rd. It was booked this year, which means that EBIT increases as a result. It's absolutely sustainable. The investment foundation intends to grow up to CHF 3.5 billion or CHF 4 billion. You can do your own maths.
When the other commissions will occur, in what half year, I cannot possibly tell you. More questions at this point? Everything has remained unclear, I would assume, and we will be excited to see what you will make of it. Thank you for coming, and as always, you are invited for an apéro riche one floor up. Maybe there is an elevator going up, a lift going up. Maybe we will have to walk up. Have a nice day and rest of the summer.