Opportunities and Risks

In addition to the opportunities and risks set out in the combined management report for the 2022 fiscal year, there were essentially no changes in the assessment of the overall risk position at the end of the first half of 2023.

The number of overall risks fell from 107 at the end of 2022 to 104 at the end of the first six months of 2023.

The number of amber risks came to 9 at the end of the first half of 2023, as against 11 at the end of 2022. The following nine amber risks were identified as of June 30, 2023:

“Value of stated goodwill” with a potential amount of loss of € 600–2,400 million and an expected probability of occurrence of 40–59%.

“Future market development leads to a drop in property values” with a potential amount of loss of >€ 12,000 million and an expected probability of occurrence of 5–39%.

“Development sale risk” with a potential amount of loss of € 150–375 million and an expected probability of occurrence of 40–59%.

“Unfavorable interest rate developments” with a potential amount of loss of >€ 750 million and an expected probability of occurrence of 5–39%.

“Higher refinancing costs due to a change in risk profile” with a potential amount of loss of € 375–750 million and an expected probability of occurrence of 5–39%.

“Failure to fulfill obligations (from bonds, secured loans, transactions)” with a potential amount of loss of >€ 750 million and an expected probability of occurrence of <5%.

“Unfavorable exchange rate developments” with a potential amount of loss of € 40–150 million and an expected probability of occurrence of 40–59%.

“Deteriorating residential property market situation” with a potential amount of loss of € 375–750 million and an expected probability of occurrence of 5–39%.

“Amendments to the German Real Estate Transfer Tax Act (Grunderwerbsteuergesetz) due to share deals” with a potential amount of loss of >€ 750 million and an expected probability of occurrence of <5%.

The risks “Higher construction costs than planned due to increases in the price of construction materials & services” and “Significant increase in the CO₂ price” were downgraded from amber to green.

The assessment of the probability of occurrence for the risk “Higher construction costs than planned due to increases in the price of construction materials & services” was reduced from 60–95% to 5–39%, with an unchanged expected potential amount of loss of € 40–150 million.

The assessment of the probability of occurrence for the risk “Significant increase in the CO₂ price” was reduced from 60–95% to 40–59%, and the assessment of the potential amount of loss was reduced from € 40–150 million to € 5–40 million.

There are currently no indications of any risks that could pose a threat to the company’s existence, and – as things stand at present – no such risks are expected to arise in the future.