Across Europe, cities are grappling with a pressing issue: how to accommodate population growth, lifestyle changes, and grow in a managed, sustainable way. A special panel session organised by the Holland Metropole alliance at the Expo Real real estate fair in Munich focused on the challenges and possible solutions.

There was almost total unanimity at the session on the first day of Expo Real that affordable housing is one of the very top priorities for European cities. However, opinions diverged when it came to whether the solutions already exist or need to be created and developed over the next five years. A significant number of participants expressed doubt that current systems are sufficient, arguing that new approaches must be developed if the problem is to be addressed.

At the heart of the discussion was the critical need for collaboration between government bodies and private investors, with neither side able to solve the problem alone. Public and private entities, panelists and delegates said, must align their interests and work together to develop innovative solutions.

Regulations

Gemma Kendall, head of multi-family homes investments at JLL argued that regulatory consistency is often more important to investors than the specifics of the regulations themselves. When rules change overnight, it becomes difficult for investors to plan long-term, which ultimately hampers the development of affordable housing. The panel agreed that consistent, long-term regulatory frameworks are essential for attracting and retaining investment in affordable housing.

Despite the complexities, there are encouraging examples of cities that have successfully aligned public and private interests to deliver affordable housing.

Jace Tyrell, CEO of Opportunity London, illustrated this point by presenting London’s approach to affordable housing. With a population approaching 10 million, London is under immense pressure to increase its housing supply. Tyrell highlighted a £5 billion housing fund proposal that would be shared by 10 to 15 pension funds. The aim is to deliver 20,000 discounted market rent homes across the city. This initiative demonstrates how the public sector can de-risk investments by fostering partnerships that provide attractive opportunities for private investors.

Eindhoven

In Eindhoven, the city has partnered with national government and private companies, securing over €4.5 billion in funding to support housing and infrastructure development. Deputy mayor Stijn Steenbakkers emphasised that Eindhoven’s success in addressing its housing challenges is due to private companies like ASML understanding their vested interest in ensuring that all workers, highly skilled professionals but also blue collar workers, can afford to live in the city.

In Madrid, the “Plan Vive” initiative has attracted international investment through a partnership between public authorities and private developers. A Japanese equity group, has collaborated with local entities to build affordable housing projects across the city, which were oversubscribed 13 times upon completion. Since its adoption in 2021, more than 4,500 affordable homes have been delivered or are underway. This demonstrates how, with the right incentives, public-private collaborations can meet housing demand while delivering returns for investors.

Investable products

The panellists also highlighted the importance of building investable products that meet the investors’ requirements. So far, the creation of international residential portfolios across Europe has been one tool for investors to diversify their portfolios but the differences in national regulatory environments are a barrier to greater investment.

To attract investment, cities need to focus on making their markets more accessible and investor-friendly. This includes streamlining planning processes and offering financial incentives, such as those available in Germany or in Spain. By reducing uncertainty and offering clear pathways for investment, cities can encourage private capital to flow into affordable housing projects.

The session also underscored that solving the affordable housing crisis requires more than just financial investment. Successful partnerships, like those seen in Eindhoven and Madrid, are built on trust, mutual understanding and shared goals. This trust is essential for projects that require significant upfront investment and long-term commitment, particularly when it comes to large-scale urban development.

Recommendations

Looking ahead, the conference participants offered several recommendations for addressing Europe’s affordable housing crisis.

1. Public authorities need to be proactive in creating conditions that attract investment, and in providing regulatory certainty.
2. At the same time, developers need to be open to new forms of collaboration that go beyond traditional development models and do not focus only on returns.
3. Expanding public-private partnerships and creating development corporations can help align the interests of all stakeholders and foster the trust necessary for successful housing projects.

Panelists: Stijn Steenbakkers, Jace Tyrell, Gemma Kendall, James Wythe (Aviva Investors), Michael Fink (Catella Investment Management)

Moderator: Tim Moonen

Report: Borane Gille and Greg Clark

Investment in innovative new construction materials is a key part of boosting sustainability in the real estate sector, and that is leading to some interesting partnerships, says Boris van der Gijp chief executive of investor Achmea Real Estate.

“The impact side of investments is a very important part of our strategy and that shows itself in the choices we make when it comes to investments,” says Boris, in an interview ahead of October’s Expo Real property fair in Munich.

In terms of ESG, the company has made great strides in making its entire portfolio more sustainable and not just by just by selling off the unsustainable parts. “We are making thousands of homes more sustainable, together with our partners. And as part of that, we are continually looking at advances in bio-based construction materials.”

One project Boris is particularly proud of is a joint programme with the farmers’ pension fund to investigate how hemp can be used in the construction process. It is, he says, particularly appropriate given the need to make farming itself more sustainable. The hemp itself is grown in the Netherlands and used as an insulation material in housing built on behalf of the farmers’ fund.

Bio-based materials

Farmers in the Netherlands are being urged to change working practices and to focus less on livestock farming which can be heavily polluting. “Hemp is not only interesting in terms of developing more bio-based materials, but it offers a new way forward for farmers,” says Boris. “What could be better?”

Another example of innovation in construction is partly funded by PMT, the light engineering pension fund. It is focusing its efforts on timber-based construction, and Achmea and the pension fund jointly sponsor a professorship at Delft University concentrating on the potential offered by timber.

“This is where you see how pension funds and we as investors can work together,” Boris says. “They challenge us to take an extra step and we then challenge them. Of course, not every pension fund goes this far, and it is always a question of finding a balance between the social impact and the financial returns.”

Social impact

The company has also developed its own tool to measure the social impact of its portfolio so that it can take concrete steps to improve it. “The social impact monitor allows us to look at hard facts and the actual sums for each unit,” he says. “That allows us to set aside extra funds to make improvements. Take loneliness, for example. This is a big issue but it is something we can work on. We can create larger areas where people can meet each other, for example, or employ a concierge who will also organise events or help to set them up.”

The results of these efforts will then be seen in the social impact monitor, “so we can see what our investments have delivered,” he says. “We are not only looking for financial returns. Environmental and social returns are important too. This tool allows us to show our investors that we are putting their money to good use. Ultimately, of course, we are doing all this for pension funds and for people who have a pension, as well as for people who are looking for affordable housing.”

You can meet Boris van der Gijp and the rest of the Achmea team at the Holland Metropole stand at EXPO REAL (Messe München) from October 7 to 9. Hall 2, stand 130.

Photo caption. Timber is an increasingly popular construction material. Photo: Depositphotos.com

The Holland Metropole alliance is heading for the Expo Real trade fair in Munich with a record delegation made up of 37 cities, investors, developers, architects and other organisations closely involved in the Dutch real estate market.

Senior government officials and Utrecht mayor Sharon Dijksma are among the participants who will be taking part in sessions on solving the affordable housing challenge and making urban growth work.

This year much of the Holland Metropole focus is on attracting investment, given the new Dutch government’s restated commitment to building 100,000 new homes a year. The government has pledged to cut back on red tape and speed up procedures and is organising a major summit on housing later in 2024 in an effort to make sector-wide concrete agreements.

The new government has also pledged to continue to pressure the European Commission to take a speedy decision about expanding the options for state support in affordable home construction by both housing corporations and the private sector.

“This really is the right time to step into the Netherlands as a foreign investor,” says Ronald Huikeshoven, managing director of area developer AM and new chairman of Dutch developers association Neprom. “The government is ready, developers are ready and the councils are ready. Everyone is combining their strengths to focus on affordable, residential area development.”

Experts estimate the some €400 bn needs to be invested in affordable, rental housing and that is a tremendous amount of money, says Mark Siezen, chief executive of real estate investor Bouwinvest. “It is a massive challenge to attract capital, but together we are committed to working on improving the investment climate. It is a shared public private mission and a very necessary one.”

The Dutch housing market is an attractive one to foreign investors because it is highly transparent and mature. In addition, public private partnerships have always been the norm and there is an important role for institutional investors.

About Holland Metropole

Amsterdam, Rotterdam, The Hague, Utrecht and Eindhoven are thriving cities in their own right. As an alliance, they form one of the most competitive regions in the world. Meet the Holland Metropole partners at the Holland Metropole stand in Hall A2, 130, or join one of their events in the busy conference line-up.

Monday October 7

10.00 – 10.50 Solving the affordable housing challenge: the roles of cities, government and investors. Panelsession moderated by Greg Clark, Exhibitor Stage, Hall C2, booth 430. More info!

13.30 to 14.50 The New European Bauhaus: Affordable Housing, Energy Efficiency, Construction. Panel session with Robert van Asten (The Hague). EXPO REAL FORUM, hall A2, booth 450. More info!

15.00 – 15.40 Urban Expansion and Redevelopment in the Century of Cities: Renewal of Port Cities. Panelsession moderated by Greg Clark, with Rotterdam deputy mayor Chantal Zeegers. DECARB Forum, Hall A3 TB51. More info!

16.00 – 16.50 Making Urban Growth Work: Affordable Housing. Panelsession moderated by Greg Clark. DECARB Arena, Hall A3 TB51. More info!

Tuesday October 8

10.15 – 11.00 Remaking Cities for the new world order: Keynote introduction. Panel session moderated by Greg Clark, with Utrecht mayor Sharon Dijksma. DECARB Arena, Hall A3 TB51. More info!

11.15 – 12.00 Remaking Cities for the new world order: Retrofit and Re-Use. Panelsession moderated by Greg Clark, with Eindhoven deputy mayor Stijn Steenbakkers. DECARB Arena, Hall A3 TB51. More info!

11.30 – 12.00 Introduction of the book ‘The Architecture of Ageing’ by de Architekten Cie. First edition will be handed to Utrecht mayor Sharon Dijksma. Holland Metropole stand, Hall A2, 130.

13.00 – 14.30 Regional Innovation Valley Utrecht: Heart of health. Hall A2, room A21 More info!

15.00 – 16.30 Metropolitan areas in transition to achieve real social value. Hall A2, Room A21. More info!

For more information, contact: Annemieke | annemieke@hollandmetropole.com

“We’re leading the charge to change the way of construction in the Netherlands, and hopefully in Europe,” says Joziene van de Linde, managing director of modular construction company De Meeuw, which joined the Holland Metropole alliance this year.

Her mission is to change the way developers and construction companies think about modular building which, she says, offers huge advantages to traditional techniques, particularly given the pressure to build more homes at present.

“There is a housing crisis in the Netherlands and the rest of Europe, and the way we have built homes for the past 100 years is not going to work anymore,” she says. “We need to build quickly and we need to reduce our impact on the environment. Prefabricated buildings, modular ones in particular, used to be considered to be cheap rubbish and were used at times of crisis. We want to show that today’s modular approach fits in upscale developments and high rise as well.”

Green advantages

Winning hearts and minds for this faster and less environmentally-taxing approach to construction led De Meeuw, part of the giant Dutch industrial group VDL, to start its own projects.

One of these is next to the company’s headquarters in Oirschot, which borders Eindhoven, and where 100 prefabricated homes are being built on the company’s own land. “We can show that we believe in the quality of our own products and that we are able to build very high-quality homes, not only social housing but high-end apartments,” says Joziene.

De Meeuw’s Oirschot factory is capable of turning out five hundred square metres of building per day using its modular construction technique, or about 12 homes.  “If you build a complex 10 or 20 storeys high in an inner city location it takes you two years of coming and going with heavy lorries,” Joziene says. “We can do it in 10, 12 weeks. We’ve done all building in our own factory and we just need to assemble it at the location, polish the façade and then we’re done.”

Cheaper and faster

There are other advantages too. “Environmental building standards, at a European level, are okay, but I believe we can do way better, specifically in the construction process and in the choice of materials,” Joziene says. “The pre-fabricated construction produces half the CO2 and 25% of the nitrogen-based pollution when compared with regular construction, which is a huge difference.”

Modular construction is also cheaper, given that the costs of engineers and architects have already been factored in through the design of turnkey modules. “Architects can put together their own design and building with our building blocks, without the need for a structural engineer. After which we can produce that building,” she points out.

The idea that modular construction produces rows of identical boxes is totally outdated, she says. “It is certainly not a one-size-fits-all all approach. One of the best compliments someone visiting one of our projects can give me is to say, ‘Oh, it’s just a home. There is nothing special about it’.”

You can meet Joziene and the rest of the De Meeuw team at the Holland Metropole stand at Expo Real from October 7 to 9. Hall 2, stand 130.

Illustration: VDL DeMeeuw’s modular housing in practice

See attachment for the Expo 2024 partner brochure

The lessons learned in creating innovative and iconic buildings are being used to create affordable housing and stronger communities, says Gideon Maasland, director and an architect at MVRDV, one of the Holland Metropole alliance’s design partners.  

MVRDV is the architect’s studio behind the iconic Valley in Amsterdam’s business district as well as dozens of other award-winning projects around the world. Valley itself, says Gideon, stems from a desire to break away from the generic concept of a tower block with hundreds of identical apartments.

“People want to live in a community, but in blocks of 600 identical apartments, you can’t even point out where you live,” says Gideon. “If we talk to people about how they want to live, you get a sketch with an angled roof, a tree, a fence, a car and a dog. But at the same time, we are densifying cities enormously and we are building blocks that are nothing like the sketch. With Valley we thought, ‘why not make far more green structures with terraces you can actually use?’.”

Valley was expensive, but lessons learned in a project like this can be translated into more affordable buildings. “For example, we learned a lot about how to build complex shapes, which would not have been possible before,” says Gideon. “So social housing also benefits… The market tends to make things affordable by making them smaller. That helps, but it is not always the right approach.”

Communal spaces

At the same time, he says, with apartments getting smaller, architects also need to think about the social and communal spaces where people can meet. “If your apartment is small and you want to celebrate your birthday, perhaps there should be somewhere else in the building you can rent for a party,” he says. “This is much better organised abroad. In Hong Kong, for example, apartments are small but communal areas are celebrated.”

In addition, it is crucial to mix different communities within a complex. “Interestingly, young people often have the same demands as old people,” he says. “Old people are often lonely for example, because their social circle becomes smaller with time. Youngsters too can suffer from a lack of social contact. So it is important to create a mix of people who can learn from each other and help each other.”

Concrete and carbon

Valley was completed two years ago and when it was designed in 2016 it was at the cutting edge of sustainability. “Now you can look at it and say ‘there is an awful lot of concrete’, and yes, it is a concrete structure,” Gideon says. “But perceptions have changed so much over the years. Carbon is a big topic at the moment.”

Gideon believes that a type of concrete will be developed which will solve the carbon issue altogether. At the same time, the demand for more sustainable buildings is pushing architects to look more toward redeveloping what is already there. “As architects we are used to starting with a blank page, an empty plot, and that is not the right approach anymore. The buildings, the things you can keep, add a certain quality to a new design.”

Illustration: MVRDV’s Nachteiland is an energy positive, timber hybrid tower

Last year, Ballast Nedam Development became the first residential developer in the Netherlands to kick off the market for carbon credits derived from developing and building climate positive homes. Now the company has introduced carbon credits for apartments, through its Horizon’s project in Amsterdam.

Natuurhuis, or Nature House, first hit the headlines last year, when Ballast Nedam Development announced its plans to develop climate positive homes which were built of wood and insulated with straw, with a green roof and walls and built-in nests for birds and insects.

The company has since signed a partnership with Climate Cleanup Foundation to attach a monetary value to the CO2 storage in the project. While the Natuurhuis’s biobased materials – timber, hemp and straw – grow, they take in CO2 and store it. By putting a price on that storage, climate-positive building projects can compete with projects that use more polluting materials such as concrete and steel.

“The shockwave this created is a signal carbon credits will become an integral part of real estate development,” says chief executive Onno Dwars.  “Carbon credits will shape how buildings will look, how they behave and what role a real estate developer will play in society.”

The attention the move generated abroad means this way of developing and the knowledge it requires could become “one of the Netherlands’ most important export products,” he says. “By creating new business models the ever-growing need to achieve sustainability ambitions and create affordable homes without subsidised efforts from the government is closer to becoming a reality.”

Currently, people buying a home in the Netherlands can borrow up to €50,000 on top of the value of their property when taking out a mortgage, if their new home has the best possible energy label.

“Now the carbon credits market has become real, we expect new mortgage agreements to incorporate this as well,” Onno says. “And the best practices which have been learned, will also benefit subsidized and social housing. The more we use carbon positive techniques, the cheaper it will get. As soon as supply is up to speed, prices will drop and compete with current building practices.”

Ballast Nedam Development believes that energy-efficient designs, integrated water management systems and green urban development are crucial to offsetting the impact of climate change. Public-private partnerships, strong long-term public policies by the national government and a supporting financial system that prioritizes sustainable and climate-adaptive homes are, Onno says, essential to ensure sustainability and affordability on the road to a climate-neutral, or perhaps climate-positive 2050.

Both the Nature House near Eindhoven and Horizons Amsterdam will come on the market before the end of 2024.

“Carbon credits are real and it is only a matter of time before they impact on the entire industry,” says Onno. “Property developers are excited by the concept and as well as being motivated to achieve a high performing product that does good for the world. Carbon credits in residential housing will rapidly change both companies and lives.”

You can meet Onno and the rest of the Ballast Nedam Development team at the Holland Metropole stand at Expo Real from October 7 to 9. Hall 2, stand 130.

Illustrations:

The Natuurhuis near Eindhoven project is energy positive

Horizons Amsterdam is part of Amsterdam’s Sluisbuurt area development project

The Dutch government has published more details about its plans to get the residential market moving again and is hosting a housing summit with investors, developers, housing corporations, and local authorities later in the year.

The aim is to draw up agreements on stimulating more affordable homes and other housing construction, housing minister Mona Keijzer said at the publication of the government’s plans on September 17. 

“Tackling the housing shortage is an absolutely top priority and it must be possible to realise 100,000 houses next year,” Keijzer said. This will be done “not only by building faster but also by making better use of existing buildings”.

The minister is making €5 billion available for housing construction in the coming years, and to accelerate building procedures. A further €2.5 billion has been allocated to develop infrastructure and public transport links.

The government has also pledged to continue to pressure the European Commission to take a speedy decision about expanding the options for state support in affordable home construction by both housing corporations and the private sector.

European Commission president Ursula von der Leyen has pledged to appoint the EU’s first commissioner for affordable housing as well as set up an investment platform for affordable and sustainable housing. She has also promised to review state aid rules and their impact on the housing sector.

Some of the new homes will be realized through major housing developments and so far 16 NOVEX locations for large-scale development have been identified nationwide. In smaller towns and villages, the development will be in the form of an extra street.  The government also plans to stimulate the building of 290,000 units for the elderly, including clustered and care developments.

The transfer tax for residential property sales, which investors pay over each property they buy, will be cut from 10.4% to 8% in 2026, which officials hope will stimulate more investors to enter the market.

Cutting red tape and reducing the time procedures take is also central to the government’s approach. The rules for repurposing existing buildings and subdividing large homes into smaller units will be simplified under the motto “yes, unless”. It will also be made easier for groups of friends to share a property.

In addition local authorities will be stimulated financially to take a proactive approach to allocating land and housing will have priority over wind turbines in areas where land for building is scarce. Any new regulations on sustainability and energy efficiency will come from Europe, rather than local initiatives, the minister said.

Photo: Mona Keijzer by Martin Beekman for the RVD