LEG Immobilien German leader in residential
LEG Immobilien is a German-based residential company with the majority of its portfolio locate in central-east province of Germany. The fund operates around 167,000 residential units and has insignificant development activities. As a large German residential leader, LEG Immobilien has estimated the CAPEX to be invested until 2030 to upgrade a big part of their stock.
Transition roadmap and CAPEX estimation: Why it matters
Investors expect the companies they invest in to be financially responsible. To this end, companies should assess transition risks, assess the costs of action versus inaction, and take appropriate measures. GREEN encourages companies to estimate CAPEX requirements for achieving net-zero targets.
A net-zero CAPEX estimation normally follows the result of an net-zero technical audit. The net-zero CAPEX estimation reveals how much CAPEX needed to reach the net-zero goal or any forward-looking science-based target, or, how financially-feasible it is to get the portfolio to the pre-determined goal. Companies afterwards decide what is financially feasible and determine the approach to take.
Quantifiable pathway with focus on impactful energy efficiency projects
In the investor presentation dated 9 March 2023, LEG disclosed its renovation plans by 2030 with associated quantifiable energy / GHG reduction expectations and contribution to the 2030 goals of each plan. Two out of the three disclosed plans involve deep retrofits (insulation refurbishment) and energy transition that will be conducted on a portfolio-scale.
CAPEX planning for 2030 energy/GHG goals
Although not yet able to give estimates to achieve their net-zero target in 2045, the company has estimated a total of € 1 billion to be spent until 2030 to decarbonize their portfolio, including investments in heat pumps to replace gas-sourced heating, and improvements in insulation of roofs, walls, and windows.
Sources
For more details, see LEG Immobilien SE, Company Presentation, May 2024
Questions about this best practices?
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