Economic, Environmental and Social Developments

We create new living space as part of our development projects and take measures to make this space sustainable and to ensure its commercial viability (see AR 2019 – chapter Sustainable and Successful Development). We use efficient property management to keep costs low in order to maintain appropriate rents.

Vonovia is using vertical expansion and densification in existing neighborhoods to create new apartments in areas that it already owns. It plans to use development measures as part of new construction projects to create new homes, some to be managed by the company itself and some for sale. Future-oriented mobility concepts allow us to reduce car parking spaces wherever possible and to create new spaces for alternative uses.

We plan modernization and other construction measures over the long term. Our modernization cost allocation is restricted to € 2/m². We keep our modernization measures affordable with efficient processes and with the help of volume advantages. We do our best to avoid cases of hardship and to find solutions that suit the individual concerned. We offer tenants over the age of 70 a guarantee that their apartment will continue to remain affordable even if the standard local comparative rents change. We ensure an attractive residential environment and support socially disadvantaged groups with active neighborhood management. We are increasing our dialogue with stakeholders, and have been including them right from the planning process stages.

We are stepping up our senior-friendly construction, conversion and refurbishment activities and expanding our portfolio to include support and care services, such as residential communities supervised by nursing assistants, for instance. We are therefore converting at least every third existing apartment that is newly rented to be senior friendly, and ensure that vacant apartments are refurbished and spaces are redesigned to be accessible or barrier-free.

We are in regular contact with policymakers and participate in discussions about how the statutory law can be implemented. At the municipal level, we are involved in constructive discussions to find solutions that benefit all parties.

Vonovia is exposed to the risk that – depending on whether the move is found to be constitutionally valid – future rental income or rental development could be reduced, posing an obstacle to modernization measures. We are reacting by significantly cutting back on our modernization measures in Berlin.

We support the government’s ambitious target of establishing a virtually climate-neutral building stock in Germany by 2050. Vonovia has been refurbishing around 3.7% of its portfolio every year of late to bring its properties into line with energy standards, putting it significantly ahead of the nationwide refurbishment rate of around 1%. Investments in technological innovations, renewable energy and new technologies also have an important role to play, which is why we and our partners are researching further cost-effective, efficient and digital processes for reducing carbon emissions, e.g., by means of neighborhood-wide energy supply systems using sector coupling. The efficiency of our processes enables us to keep the environmental costs and consequences of our operations as low as possible.

As far as the building sector is concerned, this means aiming to reduce greenhouse gas emissions in Germany by around 40% in the period from 2018 to 2030. The planned carbon tax, which is to amount to € 25/t CO₂ from 2021 onwards, will make energy consumption in private households more expensive. As a result, ensuring that buildings offer good levels of energy performance is becoming increasingly important. Measures such as energy-efficient building refurbishment, the replacement of inefficient heating systems and the expansion of renewable energy systems are the biggest levers we have at our disposal for reducing energy consumption – and, as a result, greenhouse gases – for our company. We are also contributing to the sector’s objectives by constructing new buildings that are energy efficient.

We are monitoring digitalization developments, examining their impact and benefits on our business model and, where necessary, adapting solutions to apply them at Vonovia. We have already firmly established digitalization throughout the entire process chain – from the rental process to customer service. With the help of interconnected and digitally organized processes, we can improve our properties’ environmental performance, our interactions with our customers and the way we coordinate our employees. We are making use of the advantages offered by innovative process automation, including “robots.” A real milestone in the service strategy at Vonovia is the new tenant app. Service assignments and damage reports can be processed simply and conveniently using the app and consulted around the clock. All key documents are available in the mobile inbox, with our customers receiving information on all of Vonovia’s housing-related services. We are also increasingly seeing approaches for smart home building solutions, from smart grid to assistance systems and predictive maintenance.