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Strategy-Related Opportunities

The decision to focus our business activities on sustainable and ecological action remains at the core of our corporate strategy. This can give rise to significant opportunities. Vonovia’s stated aim is to improve quality of living and significantly reduce the CO₂ emissions originating from our residential properties. Vonovia is using sustainable, ecological building materials and sustainable energy concepts to help conserve scarce resources and make targeted use of renewable energy. Within this context, we see our neighborhoods as a strong link for sector coupling. As a result, we expect opportunities to arise from the targeted digital networking of electricity, heat and mobility. As far as electricity is concerned, we are looking at approaches involving, for example, green electricity generated on a decentralized level. Possible approaches related to heating include, for example, hybrid heating systems and neighborhood heat storage facilities. Mobility concepts include charging stations and wallboxes. Further opportunities are also arising from the ecological transformation of the residential environment, such as the creation of tenant gardens and flower meadows and the installation of insect hotels so as to make a contribution to biodiversity. By focusing our new construction activities on the latest ecological standards in a targeted manner, we can make a further contribution to alleviating the shortage of housing and improving our ecological footprint and stick to the binding climate path that we made a commitment to in the 2020 fiscal year.

Sociological and economic research data suggests that the population in Germany and parts of Europe will continue to grow as a result of migration. This will result in sustained high demand for affordable housing which cannot be satisfied in full by the expected levels of new construction activity, not even in the medium term. On the one hand, this translates directly into opportunities for the development and new construction business. On the other hand, the housing market will be faced not only with quantitative challenges due to the flow of migrants, but also with challenges relating to integration that Vonovia can counter using its experience of strategic and sustainable neighborhood development. Another key factor in this regard is the demographic change toward an aging society, resulting in what is likely to be a steady increase in the demand for senior-friendly and affordable homes over the coming years. As a result, opportunities could also arise from senior-friendly modernization and investment in new and innovative housing concepts.

The coalition agreement is aiming to increase the amount of affordable housing available both by building new properties and by transforming existing properties in a manner that is as close to climate-neutral as possible. This will not be possible without private-sector investment. Creating a positive investment climate for the residential real estate markets also, however, means making the required ecological construction and modernization measures cost-effective, making additional land available for construction, reducing the amount of red tape and promoting the acceptance of private-sector real estate investors in general, which can, in turn, create opportunities for Vonovia.

Looking at the internationalization strategy, the further regulatory changes in the residential property markets in other European countries, such as France, could give rise to further opportunities provided that the overall conditions are similar and consistent with our acquisition criteria. Other acquisition opportunities in Sweden, Austria and the Netherlands could also have a positive impact on business development.

Making acquisitions within the value chain as and when opportunities present themselves, also with regard to the Value-add Business, could open up additional earnings potential. In the Value-add Business itself, significant opportunities could also arise both from entry into the B2B business and from moves to expand existing business models to include customer groups outside of Vonovia. They systematic further development of the existing Value-add Business already, however, offers scope for further earnings potential. By way of example, the expansion of our business activities relating to tenant modernization and apartment design request packages and the expansion of “fiber to the home” (FTTH) services, metering services, care and support services for our older tenants and measures to develop residential surroundings could create opportunities.

Our corporate strategy also focuses on our employees’ further development and on employee satisfaction. We aim to make use of new HR development concepts and actively shape the recruitment of new staff to fill vacant positions. We are also aiming to increase the proportion of women at the first and second levels of management. All in all, further opportunities could arise for Vonovia due to the advantages associated with diversity and as a result of our increased appeal as an employer.