Good morning. Welcome to our media conference today. Same thing to ICU. 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, Rene and then Marcus, who is going to kick off?
Okay. Okay. It's Rene.
Thank you very much, Hans Peter. Well, there was a slide for you, but you skipped it. This was it. Well, this would have been it, but I will cover it. Well, a warm welcome this morning at this media conference, strategy conference, particularly, Luca Stegher, warm welcome.
He is joining us from Canada with a 6 hour delay. So early good morning, Lucas. He is going to back for the important sales process, of course, but he is on holiday at the moment. So let's start with the most important figures. Half year deal fell.
The real estate portfolio, 6% growth to approximately CHF 11.5 1,000,000,000. We have grown in operating income, too, due to growth within Telsiano to EUR 608,000,000, this is a 3.8% growth in percentage points. The rental income dropped slightly with 0 at 0.7% minus. This is due to the asset swap with Seal City, which we sold off. And another factor is redevelopments that are still ongoing, and so we're not generating any rental income yet.
For example, the Stuki Mall and the A1 Mall in Offeringen and also the fairground tower also in Basel has some vacancies where Roche moved out, and we haven't been able to fill the space yet. So 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 percent to 2.86 million, driven by revaluations. And revaluation, whether these are special effects or not, is open to interpretation. But my opinion is that it is partly special effects.
But of course, in those areas where revaluations come from the Development business, that's a strategic factor. Euros 140,000,000 come from Development Business. And so 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 EUR 357,000,000.
Here, we have a special effect, which is true special effect, which is the deferred tax liabilities which were released. And 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 semiannual results of 2018.
And we also saw an increase in net asset value to CHF68.64. This is an increase by 5.2%. And this is only the Services segments 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.
And here also, Beethorffstrasse helped because we're able to get a better rent rate. And this also is part of our 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.
And here now, let's take a look at our core business, new and renewed leases. 61,000 square meters have been rented or leases have been renewed. This includes Lonza, 8,000 square meters at the Stuckey Park, that's one of the docks and 80% of Yond areas and Schonburgenbern, 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 Q1 of 2019 and started the sale of Building A at the Plon Leroy, 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 Praia Casia Vernet. It's the largest area of the Canton 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. We have a Wagenerholten has been filed. The building permits have been filed for improvement. We have received some approvals for the Terziano project, Ristasville and 1 in Monte. And Astuki Park and World Pass Park in Bern, we have also been able to get some topping up permits.
Let's take a look at the project pipeline. Our progress is under construction. We still have EUR 2,000,000,000. That's a slight shift compared with previous slides. We now have JPY 800,000,000 under construction, JPY 900,000,000 in development and JPY 400,000,000 reserves.
This is a shift to the well known slide. If you look at the second and the third line to your on your left, you can see the Terzyanam building, which used to be part of the development project. But 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. So on the left, beyond 80% have already been let out, and we are expecting rental income of CHF 4.3 1,000,000 per year once it's fully let.
At Bern, Schonburg, we already have a rental rate or letting rate of 95%. This is a mix of the hotel, retail, fitness, gym and also some apartments. And on the 1st November, it's going to be ready for moving in. The hotel is going to start in January. And the Westlog Zurich is a logistics building, 85% let already.
And at Schonburg, by the way, it's EUR 5,400,000 EUR 4.3 billion EUR 5,400,000,000 Schonburg and EUR 3,000,000 Westlog in Zurich. Those are the rental incomes projected. And here you can see the Plon Leroy project. As you know, 2 buildings were sold. Buildings C and D were sold to the Hans Rudolf Foundation.
And At Jet, in the old NZZ Printing building, at Jet 1 in Schliern, 70% has already been let. We are expecting considerable rental income here, too. And also, 1st phase has started. And Truki Park 2, the first phase has started. The first two buildings rented led to Lonza, EUR 5.3 1,000,000 per year, led to Lonza, the entire building.
And also some new projects for assisted living, MONTE on the left and Ristasville on the right, EUR 1,200,000 in rental income and EUR 1 point 9,000,000 in rental income, respectively. In Monte, 28 apartments and 50 beds. And Ristasville has 26 apartments and 54 beds. So it's always more beds than apartments. So that means that it's more of a service center.
This is important because the beds are usually filled immediately. These usually, we can achieve a rent of 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 curve, as I already said, 2 projects have now been transferred to the under construction category that used to be in this category. So now we have a new slide, which is to help you get some orientation.
Planning business is our core business, which is why we are presenting this. And 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 Tazianum project in Lugano. And here, we are in the design plan phase. We have already filed for approval and building applications been submitted and we have a preletting status of 100%.
The beds have been let, but the apartments still need to be let. In Alton, we have the new building. We have already published the design plan, and we still have to make some changes before we can start with the building application, get the building application. Again, pre listing state is 100%. In Alto Port Rouge, there is a new interesting development area next to the Paya Casia Verde, by the way.
And we have submitted building application, are expecting it to be approved this year, so we could start construction next year. JED 2, This is the development of Schlieren on the former NZZ property, and we are already negotiating some pre lets before submitting the building application. Schuylkill Park 2 already has received building permits, and we are now going to construct Docks 23 just before the 2nd building of the first base has been let. That will mean having let out 50% of the buildings, and that will trigger the 2nd phase. And this year, we are starting here at the Mark site with an architectural competition for the additional smaller tower.
And 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 1 of or choose the best one. And long term planning also includes another project in Geneva near the airport. And you may have heard about the airport in Geneva as being quite complex. So Rioboso and the other project near the airport in Geneva has been very successful, 90% pre letting status. And so also with this projected construction, we can also expect excellent demand.
Now let me talk about the services segment now, starting with Runkase. The assets under management have showed excellent results. First time, we exceeded the EUR 70,000,000,000 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.
And 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 Mayer, I'm looking at Oliver Hoffmann here. We projected 12% EBIT margin, which we're going to achieve. Oliver is nodding.
So 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, and that means that some of the income is not generated until the 2nd part of the year. Generally, we were able to open 2 watch boutiques, Breitling and Hublot. We are now converting the beauty department in the basement.
So everything is going to become much easier for people to find their way around. And then the Palace Cleric is going to be opened in September with around 900 square meters. We're all looking forward to that. And we now our assets under management are slightly better than in the second half of twenty eighteen. So 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 a circle investment. That's the interior construction. So there is going to be some additional costs in the second half of twenty nineteen and the first half of twenty twenty. Well, in terms of the Almori, I don't just want to read all these titles, but I would like to take this opportunity to ask Frank for 7 years of doing an excellent job at the El Moli.
And I think everyone will agree with me that we all wish you the very, very best for your future career and endeavors. And thank you very much for your great work. So we're for the future head of Yalmori. We have prepared an excellent team and well positioned department store and 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 in autumn 2020. We've had to move the opening from spring to autumn 2020.
And ultimately, also a successor of CEO of Elmeri will also have the opportunity to work on the opening of the online shop. And so this is a very exciting task, and this is the official opening on our quest for a successor. Now with Primetime Solutions, we are very proud to this young new segment. The assets under management have increased by an impressive 48.5 percent to CHF 2,200,000,000. And we have been able to acquire 2 real estate packages in the first half year, and the rental income from them have managed to offset the lack of rental income from the previous ones.
And so really well managed. And capital increase was carried out in the first half of the year, and we are expecting a 5th issue in the second half of this year to be launched. And there's also a strong increase in profitability for Swiss Prime Sight Solutions. Well, now the particularly interesting topic of services. What's the status of Tertiana today?
We now have 78 sites in 16 cantons in Switzerland. So a lot of new sites have been added. This is an image of the 30th June this year, and we are expecting a total turnover of CHF 5,000,000,000 this year, EBIT of over CHF 30,000,000. And we have 4,700 staff now, 3,323 care beds, almost 2,000 apartments for assisted living. And you can see the growth phases that we have gone through.
We by the end of 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 and to approximately 100 operations by 2024. So you may wonder why we are selling Chelseanum or 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 Tasi Anam's real estate portfolio. These were 12 properties that we were able to acquire and 11 rented properties. And this opened the door for us to implement growth in their core business in an area that we wouldn't have been able to enter without the operative business. And so 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 Senior Care and Lesbos Group and as French speaking citizens. And we didn't just grow, but we also managed and I'm talking here about the Tasiyanam team, not just SPS, but the operations team managed to make Tasiyanam ready. We invested in processes and training care workers. We introduced SAP Care Coach and the also we managed to increase the or to decrease the vacancy rates of Care Bets and Apartments.
So we now have an EBIT margin, which is very competitive. So we believe that for the last 6 years, we were the right owner at the right time for this great growth phase. So as I showed, we could now continue to grow to 90 to 100 operations, in particularly because we have our own development pipeline. But what we cannot manage is to generate additional synergy. So 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. And also, we are not able to expand the value added chain of Tresianum, 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, it would another owner would be more suitable. So that's the first reason.
And the second reason for the sale is 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. And that is why we decided on concentrating on development business. And of course, you need a lot of cash for development, and we've been always been able to cover this need with capital increases. The cash influx from selling of Castiano is going to allow us to finance future growth for the next business plan years, that would be the next 3 years, 2020 to 2023, without capital increases, which means that we would not water down the existing shares anymore.
And that's a like for like basis. Of course, we don't know what other opportunities the future holds, but that's so that was the second reason. The third reason is that selling Pasionum is going to strengthen our balance sheet. And the 4th reason and let me explain this, we've been told very often that we're very complex. And Marcus Mein and myself were told that during our roadshows again and again.
But I think the dynamics of calculated risk 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. So 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. And so those who've been criticizing us, I hope that you will now see us more favorably, and I hope you're not going to
Thank you very much, Rene. 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. 1st 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.
Are planning for strong growth in assisted living with Tersyanum. 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 3rd parties with Swiss Prime Size Solutions and Yelmold 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, but there have been some swings.
Obviously, for instance, our rental income was adjusted by EUR6.4 million due to sales. But on the other hand, we had purchases and rental income was increased by €8,000,000 as a result of that. So there was a difference of plus 1.6 percent between the 2. Now for adjusted rental income of CHF 1,400,000 the main reason was the swap of our 24% share in the Seal City shopping center versus a 49% share at the office building in Woblaafen where we control by 100% now and 2 well placed office properties in Zurich at Giswiel and Mullerstra said. Furthermore, we made medium sized purchases in the retail field.
We reduced our exposure in Bern, Barnhoof, Platts 9 at the end of last year and this year in Geneva at rue de la Coisdore, very close to the rue du Rhone shopping mall in Geneva. And we gained rental income from the 3 properties in the asset swap on the one hand, but also from Beethovenstrasse in Zurich's Business District Central Business District, a well kept office property that we bought at a challenging return a year ago. And but 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 twenty nineteen on this very property. CHF 1,800,000 of value adjustment on the portfolio of investment properties due to the Mesutom in Basel, where the major tenant moved out. And as mentioned before, we are negotiating with interested parties.
Negotiations are seem to be promising. Based on this situation in Basel with the Mesutum, we had a like for like of minus 0.8 percent attributable to this very situation. Then we had minus CHF2.8 million of temporary reductions of rental income due to major repositionings, more or less the same ones we had at the end of 2018, 1st and foremost, the shopping mall on the Stricky Park site in Basel, where we've been moving away from a shopping center towards more lifestyle shopping enriched with entertainment, medical offers, sports and 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 8 sites that were vacated at the end of last year by the OBS Group in Switzerland, Fast Fashion.
And at Christmas 2018, we had rented, let out all the 8 properties at higher income. And these properties at Bafu, Surplatz in Basel will no longer be in fast fashion, but it will be converted into a banking outlet. And 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 2 properties mentioned before in Geneva around the Geneva Airport, the Geneva Business Terminal and the Riembeauson Properties, both of them are fully let by now. And finally, due to additionally leased properties in assisted living, we ran a €700,000 of additional rental income.
On the left hand side here, you can see the top line situation, operating income and in middle and center EBIT divided into real estate services, the 2 segments, and 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 rental from income from development properties is concerned, we've got 2 complexes in development that we've already sold, And we will generate income as a percentage of completion by 2021.
This refers to the Plinleywort properties and 3 residential properties in Bern at Welpost Park. So much for the increase in real estate. Now for services, we rose by €17,000,000 or 4.3 percent, £12,000,000 in the field of assisted living. That's the growth story we're seeing here and £5,000,000 in particular for asset management for 3rd parties following reorganization in the past year, we're now generating these fees. This leads to EBIT of EUR 286,100,000 in the half year, 90 2 percent from the core business of real estate and the rest of it divides into what you see at the bottom, strong growth with Tercianum as we saw at the level of the top line.
Then Wincasa, we've got top line growth as a matter of fact. However, we're very much in the phase of transformation there. We are getting fully digitalized, and we are focusing on moving towards digital business model. We've got set up an innovative call center for the essential most essential 20 to 25 questions that people ask. This will take more investment.
We have not completed it yet. And of course, this leads to a charge on EBIT this year and last year for Wincasa. But the assets under management, €75,000,000 of assets under management Threshold has been passed and that's a result of our expansion in this field. Yelmole in a challenging environment improved on EBIT. But as Rene Zand mentioned, we are assuming that based on the investments that we are to make with the ARO project at the air site at the airport and the 2 former Circle and where we have some construction delays and 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 Solution from 1.6 to rose from 1.6 to 2.1, and I think that speaks for itself. And 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 fifty-fifty among investment properties and development properties.
And 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, Jetty and beyond. And the 2 projects in Geneva, Tourbillon and Pontrouges and Schoenberg at Bern as well as Stricky Park at Basel, specifically the finger docks on the Stryke Park site. The market weighted average real discount rate reduced to 3.17% by 5 basis points or in nominal terms, 3.69%. Then we've got sales proceeds on investment property in the amount of CHF5,600,000.
That's the sale of Riu de la Cueto, a retail trade property. And 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. So we have a total of EUR 12,600,000 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 Tercianum 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 June rose to 5,200 FTEs, up from 4,900 a year ago. Financial expenses was slightly decreased. We were benefiting once more from a yet lower interest rate setting without changing our financing structure though. And very special thing to mention in this first half year is the tax expenses. They're usually expenses, but here we've got a tax income for this half year because the Swiss people on the 19th May 2019 voted on staff.
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 have benefited from massive tax as a result of which we had to reverse some of our deferred tax provisions in the amount of CHF 158 1,000,000. They are still at CHF 1,100,000,000 of total deferred tax provisions that we have on the books. This is non cash, of course, and 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 151 point €3,000,000 last year to around €356,500,000 For reasons of transparency, we always showing this without revaluation gains and deferred tax.
And 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 2 major value increases on the portfolio both like for like and for projects. So this increase in value is composed of investments and the EUR 85,000,000 divided into the 2 components of revaluation gains as shown before. Then 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 solid capitalization based on equity.
Of course, the strong increase in profit 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 of 4.3 years, one major transaction that we completed in the first half year, a BRL350,000,000 straight pond at 1.25 percent coupon for 8 years and we have refinanced a €200,000,000 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%. So much as far as finance is concerned.
Let me hand it back to Rene
Zandt.
Thank you, Marcus. Let me move on with the outlook or confirmation of our goals. Now this is the first half year, so I'm not going to give you a major outlook on the market. Just we'll make a few short statements. Geopolitical risks are not going to decrease trade war USA, China.
What impact is it going to have? At the moment, it looks like having a positive impact for real estate companies of 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, not 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 micro location of course. We can see potential in the field of logistics. There are some logistics centers in the project pipeline as you can see. And for the retail business, it is fair to say that 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 Oviese sites that we occupied again. It will be interesting to see how inner cities are going to evolve. The 8 OVIESA 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, but that's there's only one site where we are offering fast fashion. On the other sites, we have banks and dentists and things like that. But this goes to show that good retail sites can be used for different purposes producing higher rental income at the end of the day as the OBSA example shows. These are the points to be borne in mind product, service, quality and the right place, the right site. Now the vacancy rate I've already mentioned, Tersianum 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. And 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 BRL 83,000,000 that we expect from the pipeline.
And saying that, this includes potential not doesn't include potential from reserves. It only includes specific things that are under construction or in development. So reserves, land reserves are not included here. There's a total of CHF83 1,000,000 rising in the years to come. Unfortunately, we only have CHF1.1 million from the 2 projects of Yond and Schonburg this year.
Why so? Because they will go back to the portfolio only by Q4, but then there's going to be nice increases of €15,800,000,000 17, €14,000,000, €15, €90,000,000 So always between €14,000,000 to €19,000,000 of rental income every year. So 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.
So as a consequence, rental income would perhaps go down, but then we would have to post proceeds from sales as a result. So I'll be available for questions, but handed over for the Q and 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 Tertiana. I'm probably not surprised that I'm asked about this. So what's the duration of rental contracts going to be in the first half of twenty twenty? Are you also considering changing some of the rental contracts? No, we're not considering any changes to rental contracts.
Most of the Onto contracts that we own are not going to be changed. The long term 20 year contracts, more or less? So the average now maturity is now 15 years, yes. Thank you. And you spoke about additional cost per circle for Yale Malley in the second half of twenty nineteen and beginning of 2020.
What's the quantity? Well, we spoke about when Yalmori should reach the 0. But so originally, the target was 2020, but that would have required us to open in the spring of 2020. And if we'd done that, we would have invested into interior design in 2019. But now the plan is to start to achieve the 0 in 2021.
And we still have some investments to make, which are going to have a negative effect on EBIT. The quantity equal would be achieved, and that is now going to equal would be achieved, and that is now going to be a year later than originally planned. And 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 Well, I'm going to talk about Schonburg.
Well, I live very close, 500 weeks a day. And 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 that those are the 10s that maybe don't have the ideal layout. But as a basic principle, we certainly achieved the level that we were aiming for, for the hotel anyway. And retail is food retail.
So yes, but now I'm going to pass over to our specialists 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.
And that's why we waited a little, didn't try to speed things up by reducing the price. But we asked for the CHF260, 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. And were there any contributions for interior design, etcetera?
Well, sometimes 3 months mostly. And just two brief questions. Well, like for like grows ex Fairgrounds Tower and Basel, well, relatively flat. And on Slide 28, you gave an outlook to the future rental income. And it says here in the small print in full rental.
So 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, it's a question is how long it's going to take. It may maybe take a year before full rental is achieved, but that's so it's always a relative question of what full means. Well, and 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 in the market. And a question on the yields, which are in the business report, the 5.8% for the 2 projects, These are net yields, and those include a 4% vacancy rate. So and this is the net yield. Next question? Some follow-up questions.
Maybe you can give us a few more details on who the potential buyers are. We're not going to comment on that. And 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. So the margin increased by 130 basis points. Was that driven by operative improvements or or investments that have now been discontinued so that you achieved the 5.7% of the EBIT margin? You talk about Teslanam only. Well, this is due to operative results.
And this does not yet include the startup costs. It always takes a while for new operations to get into full swing. So this is operative results due to process improvements, SAP Care Coach also getting the yield up and costs, of course, is part of the operations. And so the care beds and the apartments have to be filled, and the team managed to do that. Well, it's good management.
And it's very simple, more beds rented out, and that increases the profitability. But that has nothing to do with the idea of selling. That's just good prices management. And maybe another question on the Elmeri. So 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.
Yes. 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 twenty twenty, are you going to try and achieve flat like for like? Yes, we but due to the situation in our markets, we expect a flat development.
Well, the tax effect was very good. And there are also discussions in the Canton of Zurich in terms of some changes here. And what do you expect the effect to be for you? Well, in Geneva, in the Canton of Geneva, there was a reduction by from 24 percent to 14%, and that's certainly not the kind of reduction that we can expect in the canton of Zurich. But 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.
But well, we're not expecting really anything in terms of tax cuts in the Canton of Zurich because even if the vote is accepted, and the Canton of Zurich still has one of the highest tax rates, I spoke to Mr. Stocklin, and the expectations should not be raised here. Is there any news on Oftringen? There was a discussion about selling the property. And in Geneva, you also sold a retail property.
So are there any plans to reduce the retail share in the next 12 to 18 months? Well, we've already reduced the retail share a little.
And
we are currently reassessing our retail definition because some of our tenants are not even retailers anymore. The question about Aon, well, 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. And so 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, but we can't really say. Well, 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%. And of course, it's a question of quality.
Retail is not the same as retail. So 25% would also be okay if it's the right retail. So I have a question concerning Espasturbillons. Investment costs have been reduced to EUR 180,000,000. Before, it was EUR 232,000,000.
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.
So condominiums are only the form of property. And we've noticed that a lot of commercial operations have to relocate. And when looking for substitutes, they find it difficult, particularly when they want to reinvest in order to save on capital gains tax. And so that was a market there's a gap in the market that we discovered. And we saw that there was a demand and therefore decided to go for it and split the property into various condominiums and separate floors.
So this is simply adapting to the needs of SMEs. Well, in the large development areas that we mentioned earlier, some of the businesses have to move out, and they now have the building property by Geneva. I have the so these commercial operations understand. So usage is going to be commercial anyway. Yes, of course, it's going to remain commercial.
So 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 are still building new buildings for the new owner then. So what's the contractual arrangement going to be about who's going to have which shares? And how will Swiss Prime Side shareholders know what they will be the owners of? And second question, you already mentioned complexity as an argument for selling it.
But now if I understand you correctly, that means that the remaining 3 business areas are considered core business areas and that we're not to expect you to sell off any other business units?
Well, let's begin at the back. We're not talking about selling other units at the moment and for shareholders. With regard to real estate, there won't be any changes. We continue to be the owner of the real estate. And with the new owner of Dersijanen, we are going to have a rental agreement.
That's my pragmatical view of things. So the shareholders will take part as they are taking today in the real estate. Well, of course, the rental agreements of Tertianum, the 16 properties that are owned by Swiss Prime Sud, These are rental agreements agreed at arm's length. So for the other 62 rental agreements, we know what third parties would conclude. It's entirely at arm's length and potential buyer would have no reason to doubt these rental agreements.
They are in agreement with the market conditions, no problem. And we clearly defined what was contributed by the owners and by the tenants. So for a 3rd party buyer, it would be no problem to identify their position as the buyer. Thank you very much. Further questions?
Yes, please. Andreas Brunkett 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 Tersyanum construction permit for 2020, 2021? Or what is the reason that these figures are slightly higher?
Well, 2021. The €83,000,000,000 we've shown that in the annual result. The €83,000,000 will remain €83,000,000 fundamentally, but there may be a shift over the years. So the question is when is a permit coming in, when will we be able to complete a building and when to market it. So 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? Well, even following realization of the 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, That is probably is that sustainable with a view to the future? Well, we expect it to be sustainable. Well, 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. But then the profitable business, of course, will be sales and purchasing commissions, and that depends on the point in time you have acquired a portfolio. Now we are fortunate enough to have acquired 2 major portfolios in the first half year. By the way, I would have preferred to have one of them in the past year, but one of them was in December, but closing was on January 1 3.
So it was booked this year, which means that EBIT increases as a result, but it's absolutely sustainable. The Investment Foundation intends to grow up to CHF 3,500,000,000 or CHF 4,000,000,000. So you can do your own math. But when the other commissions will occur, in what half year, I cannot possibly tell you. More questions at this point?
Okay. Well, so 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 Apero reach, 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.