Contrary to numerous forecasts, the managers of BUWOG Group GmbH, Andreas Holler and Kevin Töpfer, are optimistic about the 2023 financial year. Despite new challenges for the real estate industry as a whole, the company plans to take advantage of the special market situation, aiming to pick up pace again no later than by the end of the year. Our objective is to continue the course of growth we had in past years. On order to succeed, we are examining processes and strategies as well as new measures concerning sustainability and other issues, which fit our business model, because only by adapting can we meet the needs of the changed market conditions,” says Kevin Töpfer, who, as director of commercial affairs, is also responsible for asset management at BUWOG. “Essentially, we will use the year to press ahead with the overall development of the organisation. We want to become more digital and efficient and to therefore create an improved customer experience and achieve even greater employee satisfaction.”

Managing Director of Development Andreas Holler also confirms that BUWOG is well positioned for 2023: “We have a sizeable portfolio of land and are consequently in a good position, even in relatively difficult times, because it allows us to think long term. We are working on getting the development projects we’ve planned ready for construction so we can continue building directly as soon as the situation has eased somewhat.” Holler sees ample potential for BUWOG, particularly in the large-volume urban planning and development projects concentrated in the Vienna area, as well as in opportunities for redensification, for example in Salzburg.

Completions, interrupted construction starts and residential costs

“We’re very pleased to be putting more than 600 new apartments on the market again this year, thus ensuring a quality supply for apartment seekers in Vienna,” Holler continues. The total of 652 new rental apartments and condominiums are distributed across the RIVUS Vivere, DECK ZEHN and HALLER projects. In the KENNEDY GARDEN project, the final components will be handed over to the new residents at the beginning of the year.
The current challenges such as inflation, increased construction costs and the energy crisis have resulted in BUWOG postponing construction starts planned for 2023 until further notice. “The current market situation along with a decline in building permits and lengthy rezoning procedures will lead to a shortage of completions in the coming years – the logical consequence of this is for the increased surplus in demand to drive prices up even further, but that can’t happen!” According to Holler, it is up to policymakers, in particular, to counteract this development with relevant measures. “It’s an important concern for us and part of our responsibility as developers to be able to continue offering affordable housing. That’s why we’re working intensively on how to optimise costs in new construction, for example, through modular construction and a focus on digitalisation throughout the entire value chain,” Holler says.

Kevin Töpfer adds: “As a full-service provider, BUWOG covers everything from new construction to existing housing, which gives us considerable competitive advantages in the current situation.” The market situation is not yet apparent at the moment, particularly in the sale of existing apartments. “Though the supply of new apartments is on the decline, many people still seem to have sufficient cash to continue financing the purchase of existing apartments. Those who cannot or are reluctant to buy for various reasons are increasingly resorting to rentals in the upper price segment.”

Depending on how energy prices and the associated operating costs and heating bills continue to develop, financial burdens may arise for customers, which makes it all the more important to seek fair solutions with all of the customers in the rental segment affected. “As a provider, our approach is as an equal, and we will do everything we can to ensure that no one loses their home,” Töpfer emphasises. Both managing directors are convinced that despite all the difficulties, there will soon be a new spirit of optimism on the market that will have a positive impact on every segment of the real estate sector and, of course, on the customers.

Focus on sustainability and digitalisation 

In BUWOG’s perspective digitisation and sustainability are two key focal points that are nearly inseparable. For example, a digital roadmap in project development digitally maps the entire process of a property, whereby existing potential in the areas of customer journey and climate protection can be identified and subsequently exploited. Related issues that BUWOG will increasingly address in the future include the use of alternative building materials, modular construction and recycling management. All of these aspects could be advanced in the form of cooperations such as with Gropyus and with start-ups: “The objective we’ve set for ourselves is to be pioneers in sustainable project development. The fact that Gropyus relies on a fully digitalised serial timber hybrid construction method for new building projects coincides 1:1 with our aspirations. We can also generate advantages in the cost structure by working with companies that are focused on digitalisation in conjunction with the circular economy and modular construction,” Andreas Holler explains.

Digitisation measures are to be further advanced in the existing portfolio and in commercial areas as well, thus bolstering the sophistication and efficiency of BUWOG’s processes and structures, Kevin Töpfer says: “In the first quarter, we will be the first and only company in the domestic sector to launch a pilot project for the implementation of a hybrid owners’ assembly. In addition to the digitalisation measures of ours that are already underway, such as digital key management and the launch of our optimised customer app, also planned for the first quarter, we aim to further expand our pioneering position in customer service.”

In terms of sustainability, Kevin Töpfer sees ample potential in portfolio management, which is to be exploited, among other things, through a rehabilitation agenda. "On average, more than a hundred apartments benefit each year from thermal rehabilitations that significantly reduce a building’s energy consumption, which also leads to financial savings for our tenants,” Töpfer says. At the same time, the result is an increase in living comfort for the residents and optimised protection of the building fabric. “Investments in the existing portfolio are the be-all and end-all to be able to offer our customers contemporary living comfort and to meet the requirements of climate protection. In addition, as part of the initiative to phase out oil and gas and in view of the current price increases, the company’s objective is to replace heating systems. “Some of our existing properties still lack modern heating systems due to their age, thus we are planning to retrofit the heating systems in more than 100 apartments each year.” Moreover, two pilot projects are currently underway, in the course of which photovoltaic systems are being installed on existing properties. “For us it is a matter of trying new approaches and solutions, thinking outside the box and doing something good for the environment as well as for our customers. But that alone isn’t enough: “Even though BUWOG already exceeds many of the EU taxonomy requirements, the various decarbonisation and climate protection measures require corresponding support programmes from the city and province, otherwise Austria will not be able to achieve the goals stipulated by the EU.”

Skilled workers and management from within the companyn

Finally, Kevin Töpfer, who as director of commercial affairs is also responsible for human resources management at BUWOG, points out that the shortage of skilled workers in many areas is not particularly noticeable in the company at the moment. “We are focusing intensively on the development of our employees and managers in order to strengthen their potential even more.” The BUWOG 2023 apprenticeship programme is to be continued as well. “We are thinking long-term and for this we need a strong team – after all, it is the employees on whom the success of a company is based. BUWOG stands for dynamism, security, development opportunities and team spirit. This makes the company attractive and a reliable and award-winning employer – a position that we would also like to further expand in the future.”