GWG and Gewofag Munich are sounding the alarm: Only 650 new apartments are possible per year - there is not enough money

Created: 01/04/2022, 7:00 PM

From: Sascha Karowski

Houses in the construction phase: There is still a shortage of living space in Munich.

© Marcus sleep

The municipal housing associations GWG and Gewofag are sounding the alarm.

From 2025 onwards, only around 650 apartments can be built per year.

2000 would be politically desirable. Problem: There is a lack of money, also because rents are not being increased.

The city should now step in.

Munich - Housing construction and cheap rents are central issues in Munich. The municipal housing associations GWG and Gewofag should do their part. To this end, the city council has set goals; since 2018, at least 1,250 affordable apartments are to be built. In the economic planning for 2021 to 2025, the administration is even assuming around 1,500 apartments per year. In October, the Greens and the SPD increased the target number to 2,000 apartments through Gewofag and GWG. But it is already clear: even the target number of 1,500 apartments will soon no longer be achievable for the municipal construction companies. "From 2025 onwards, the companies would only be able to complete an average of 650 apartments a year on their own."

Munich: Waiver of rent increases costs GWG and Gewofag 100 million euros

There are many reasons for this assessment.

In 2018, the city council initially dampened rents at the municipal companies and even decided to stop rents in the city in summer 2019, which stipulates that rent increases will be suspended until July 31, 2024.

As a result, GWG and Gewofag forego 100 million euros in additional income during the period that could have been generated by rent increases.

Another reason is the usual increases in construction costs.

For comparison: in August 2021 they were 11.8 percent higher than in the previous year.

In addition, desired higher energetic standards (EH 40) play a role in new buildings.

What also has financial implications are the rights of first refusal.

Between 2018 and 2021, Munich bought apartments for around 787.1 million euros.

The city paid 656.9 million euros of this.

The housing associations finance the remaining amount through loans.

Munich: GWG and Gewofag need 725.8 million euros by 2030

GWG and Gewofag are subsidiaries of the state capital, which together manage 65 902 apartments. For comparison: there are around 800,000 apartments in Munich. Even the most recent increases in residential construction were only possible with financial subsidies. Most recently, the city council launched a 250 million euro program for the years up to 2025. But that won't be enough. "With additional financial resources of around 725.8 million euros, Gewofag and GWG can complete a total of 14,840 apartments in the ten years from 2021 to 2030, of which 9,531 apartments in the EH 40 standard," says the submission with which the city council is on dealt next Wednesday.

The Greens and the SPD want to stick to the target numbers and help financially.

SPD leader Christian Müller points to numerous funding opportunities from the federal government and the Free State.

“We assume that these funds are to be expected.

We have to see what sums are left over.

But in principle we consider that to be financially viable. "

It was clear from the start that GWG and Gewofag could not build the new buildings from their own resources, says Greens boss Anna Hanusch.

“And we don't want to counter-finance this with rent increases.

This is also an important signal that GWG and Gewofag are continuing to invest in the construction of affordable apartments. "