wbg Group on track for 2021

51 construction sites, 982 flats worked on, around €122.8 million invested in existing properties, 17 municipal projects for €306.2 million in progress

The 2021 financial year of wbg Nürnberg GmbH Immobilienunternehmen and its subsidiaries was marked by a further high demand for housing. This applies to the areas of both rental housing and property development. The issues of new housing construction and modernisation with the aim of achieving affordable rents, the improvement of the carbon balance to protect the climate, cost optimisation in housing construction, and the expansion of the infrastructure for the benefit of the people in the city also continued to be relevant.

The focus of the report is on presenting projects that were in the process of construction. Numerous further building projects are in the planning and construction preparation phase. The construction activities of the wbg Group are divided into the areas Portfolio (rental flats), Property Development (owner-occupied homes and condominiums) and WBG KOMMUNAL (infrastructure for the City of Nuremberg). In the 2021 financial year, work was carried out on 51 construction sites in the greater Nuremberg area on behalf of the wbg Group.

A total of 17 construction sites were for wbg Nürnberg’s own portfolio. A total of 828 rental flats were worked on (505 completed), of which 272 were being newly constructed (211 completed), 32 being converted with 5 residential units added on, 495 being modernised (283 completed) with 24 (11 completed) residential units added on.

Included in the construction backlog were 323 rental flats, 32 newly constructed units and 18 units being created through additions, 42 rental units being modernised and 170 in basic modernisation. The list additionally includes 1 commercial unit.

Moreover, 1 SIGENA neighbourhood meeting point and 2 further commercial units were completed.

For the newly constructed buildings, the standard house developed by wbg was mainly used. The typified floor plan arrangement in different building typologies makes it possible to reduce planning costs and shorten construction times considerably.

Of the almost 300 rental flats in the new building, 130 rental flats were built according to the criteria of the income-oriented subsidy of the Free State of Bavaria. A graduated modernisation concept is employed to keep rents stable in the different districts. Modernising the existing buildings yielded a sustainable improvement of the final energy and carbon balance for the Group’s real estate portfolio.

Plans for the district portfolio development of the former distillery site on Äußere Sulzbacher Straße were continued in earnest. Preparations for construction were completed on schedule by the end of 2021.

A non-open urban development ideas competition was held for the Sandäcker district with the theme “Climate-friendly living and working in the Sandäcker district in Nuremberg Gebersdorf”. This was preceded by comprehensive internal administrative briefing and digital public participation as well as consultation with the citizens’ association Bürgerverein Gebersdorf e. V., the results of which were incorporated into the competition announcement. The subject of the competition was an urban design with an in-depth section for a climate-friendly district centre on Diebacher Straße in connection with the Gebersdorf underground station on line 3, which is currently under construction. The district centre includes general service, local supply and residential functions as well as social infrastructure facilities at the interface between the underground station and the adjacent districts.

The Property Development division also completed 154 residential units on 17 construction sites. Of these, 19 owner-occupied homes and 2 parking decks with 20 parking spaces each were completed. A further 102 condominiums and 33 owner-occupied homes were added to the construction backlog.

For the City of Nuremberg, WBG KOMMUNAL GmbH as a subsidiary of wbg Nürnberg GmbH built schools, after-school care centres, gymnasiums, day-care centres, fire stations and the sports and cultural hall Am Tillypark at a total of 17 locations in Nuremberg. Three construction sites with an investment volume of around €54.6 million were completed in 2021: the sports and cultural hall Am Tillypark, the conversion of the small hall at the Ludwig-Uhland-Schule, the after-school care centre on Hugo-Distler-Straße and the day-care centre on Forchheimer Straße.

Newly started were the construction projects Kindergarten Palmenhof in the Old Town and the gymnasiums of the primary school with an after-school care centre on the street Am Thoner Espan with a volume of €17.6 million.

All other construction sites were included in the construction backlog for 2022. These include new constructions of the Bertolt-Brecht-Schule as a public-public partnership project, as well as the after-school care centre on Glogauer Straße, the day-care centres on Am Stadtpark and Grünewaldstraße, the Max Beckmann-Grundschule primary school, and the fire stations in Buch, Eibach, Gartenstadt, Kornburg, Moorenbrunn and Worzeldorf. The investment volume for this amounts to around €234 million.

“With an investment volume of over €122.8 million, the wbg Group once again made a significant contribution in 2021 to ensure that Nuremberg can achieve its socio-political goals. At the same time, despite the difficult time of the pandemic, we were able to continue our course of growth and promote key topics for the future, such as EU taxonomy, optimisation of employer marketing, and similar areas”, states wbg Managing Director Frank Thyroff with a view to the 2021 financial year.

“With 51 current construction sites and a construction volume of 982 residential units, we have also fulfilled our mandate to provide housing for the people in our city and sustainable urban development in 2021. With all our efforts in new construction, it is important to us that we do not lose sight of our existing property portfolio. We have spent an additional €42.8 million on maintenance, security of the existing portfolio and outdoor facilities. We are therefore consistently orienting ourselves to the current social challenges”, explains wbg Managing Director Ralf Schekira.

In order to meet the challenges of the market and the targets of the shareholders in the coming years, the economic and financial strength of the Group is imperative. The focus here is on investments with a view to creating new living space and to maintain the housing portfolio. We will exploit this good starting position so that we can continue to act effectively for Nuremberg and the people in the city in the years to come.

However, a reliable funding framework is also absolutely necessary to ensure, on the one hand, that the goal of affordable rents can be achieved and, on the other hand, that climate protection measures can be implemented.

In the second year of the pandemic, it is impossible to ignore its impacts. Significant price increases, supply bottlenecks and staff absences are just a few examples. Despite these challenges, the effects have proved manageable not only within the industry as a whole, but also at wbg. The digitalisation strategy we developed in the past and the milestones we have already implemented, such as the online application for rental flats and the digital customer portal, were helpful building blocks for upholding regular operations during the crisis. This is a path that we will continue to pursue.

The armed invasion of Ukraine is a source of concerns for us. Most of the people coming to Germany and our city are women with children and elderly people who need to be provided with everything, including housing. Despite all our efforts, there is still not enough space for everyone, and this is increasing the pressure exerted on the market and thus on our core business.

Supply bottlenecks are now being exacerbated by the Ukraine war and the necessary sanction measures against Russia, as many materials are no longer available or only to a limited extent. This ultimately also drives up construction prices. And all this is compounded by an unexpectedly drastic general price increase and an initial rise in interest rates for real estate loans on the financial markets.

“A high level of commitment is required here in all entrepreneurial decisions in order to contain the negative impacts. Looking back at the 2021 financial year, we can pride ourselves in having achieved our planned annual result despite the pandemic”, explains Managing Directors Frank Thyroff and Ralf Schekira, summarising the current situation.

The 2021 Annual Report can be accessed at wbg.nuernberg.de/medien/mediathek/geschaeftsberichte/.