Europe faces a huge challenge – and an equally great investment chance. Over the next 15 years, the EU and the United Kingdom will be up to 20 million new residential and commercial space needed. This corresponds to about 2,000 km² mixed residential and commercial space. According to a new report from Ginkgoa partner of Edmond de Rothschild Private Equity This offers investors investment opportunities of around four trillion euros.
Instead of relying on a new building in untouched areas, there is a sustainable alternative: the revitalization of unused industrial areas and empty office building. The GinkGO report “Urban Regeneration: Turning Obsolescence Into Value for Society, Nature, Climate and Investors” comes to the conclusion that it is inadequately used in Europe 19,000 km²-this corresponds to an area ten times as large as London-and 300 km² unused office space.
Millions of new apartments
If only a fraction of this “Brownfield” areas were re-opened, 15 to 20 million apartments and mixed areas could be created and the need for living and working space could be covered. This creates attractive chances of return for investors, while at the same time the area consumption is significantly reduced and urban rooms are revived, the report.
The urban renewal has the potential to develop into a separate asset class with strategic growth potential. The focus should be on renovation projects that have different risk profiles.
Accelerate modernization
In addition, sustainable planning, close cooperation with local actors and a long -term promise of value should be taken into account. Francois-Xavier Vucekovic, Chief Investment Officer at Edmond de Rothschild Private Equity, says: “Urban renewal was considered the task of the public sector for a long time. The need for accelerated modernization and the advent of private renovation companies (for industrial wasteland) and building contractors open up new opportunities for the private sector. ”