Bern Pension Fund Rent Hike Sparks Outrage: 70% Increase After Renovations – Breaking News
Bern, Switzerland – August 28, 2025 – A wave of anger is sweeping through Bern as the City of Bern’s Personnel Pension Fund (PVK) announced a staggering 70% rent increase on newly renovated apartments on Bahnstrasse, significantly exceeding previously communicated estimates. The move threatens to displace long-term residents and underscores a growing affordability crisis in the Swiss capital. This is a developing story, and archyde.com is providing up-to-the-minute coverage.
The renovated high-rise buildings on Bahnstrasse 59 and 79, Bern. (Photo: Nicole Philipp)
From 40% to 70%: A Broken Promise?
In February 2023, tenants of the two high-rise buildings at Bahnstrasse 59 and 79 received termination notices, many after decades of residency. While the PVK initially indicated a 40% rent increase following renovations, the reality is far more drastic. A 3.5-room apartment, previously renting for CHF 1180 per month, now costs CHF 2,000, plus an additional CHF 240 in ancillary costs – a 70% jump. This dramatic increase has left former tenants reeling and questioning the transparency of the process.
“Lied To”: Residents Express Disbelief and Resentment
“They were lied to,” one resident, who wished to remain anonymous, told local reporters. “For people like us, there is no more space.” The sentiment reflects a broader feeling of betrayal among those who were promised priority re-letting but now find themselves priced out of their former homes. The PVK is marketing the renovated apartments as “modern living at a new level,” boasting features like in-unit washer/dryers, stylish kitchens, and oak parquet floors, seemingly targeting a wealthier clientele. The stark contrast between the promised affordability and the current pricing has fueled accusations of social cleansing.
The Pension Fund’s Defense: Legal Obligations and Market Rates
Jürg Schad, managing director of the PVK, defends the rent increases, stating the fund is legally obligated to maximize returns to finance pension payments for its members. “The PVK needs an appropriate return,” Schad explained. He also asserts that the higher rents are aligned with the current market rates for comparable properties in Bern. However, critics argue that as an urban pension fund, the PVK has a social responsibility to provide affordable housing options, not simply chase profits. This debate highlights a fundamental tension between financial obligations and social impact.
A Wider Trend: Displacement in the Bern Region
This situation isn’t isolated. Similar displacement issues have recently surfaced in Bolligen and Breitenrain, where tenants have also received notice of significant rent increases following renovations. These cases underscore a growing trend in the Bern region: landlords are leveraging renovations to push out long-term tenants and capitalize on rising property values. The lack of robust tenant protections and the increasing demand for housing are exacerbating the problem.
Evergreen Context: The Swiss Housing Market and Pension Fund Investments
Switzerland’s housing market is notoriously tight, particularly in urban centers like Bern. Demand consistently outstrips supply, driving up prices and rents. Pension funds play a significant role in the real estate sector, often investing heavily in residential properties to generate returns. However, this investment strategy can create conflicts of interest when it comes to affordability. Unlike some countries, Switzerland doesn’t have widespread rent control, leaving tenants vulnerable to significant increases. Understanding these systemic factors is crucial to grasping the complexities of the Bern situation.
What Can Be Done? Exploring Alternative Approaches
While the PVK maintains that renovation was unavoidable, examples exist of successful renovations that prioritized tenant retention. A recent project in Bern’s Gairetometrys district saw 80% of former tenants return to their renovated homes. This was achieved through careful planning, active tenant management, and a commitment to finding transition solutions. Advocates are calling for the PVK to adopt a similar approach, including exploring options for subsidized units or cross-subsidization to maintain affordability. Rentplenum Bern, a newly formed tenant advocacy group, is leading the charge for greater transparency and accountability.
Finance Director Melanie Mettler (GLP) maintains that the PVK’s investment strategy doesn’t negatively impact the real estate market, but the experiences of residents on Bahnstrasse suggest otherwise. The question remains: can Bern balance the financial needs of its pension funds with the social imperative of providing affordable housing for its citizens?
Stay tuned to archyde.com for further updates on this developing story.
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