An investment management company (KAG) faces the challenge of making its real estate portfolio more sustainable. ESG-compliant assets for a KAG are becoming increasingly important and the focus is on the long-term profitability, value retention and economic viability of commercial properties. With innovative solutions such as energy efficiency measures, sustainable energy sources or flexible operator models, KAGs can not only reduce CO₂ emissions, but also achieve economic benefits. These range from additional income and increased attractiveness for tenants to the avoidance of trade tax infections or stranded assets.
Modernization roadmaps for ESG-compliant assets
Without Energy modernization roadmaps for their portfolio properties is no longer enough for investment companies today. In order to comply with regulations and improve their market position, many investment companies already have to ESG requirements be fulfilled. The company's own electricity production using PV systems and modern Energy management systems play a central role in extending the profitability of assets. This is complemented by the integration of Battery storage systems, Charging infrastructures for E-mobility or efficient heating and air conditioning systems. This increases the attractiveness of buildings for tenants and investors, reduces CO₂ emissions and generates additional income.
Additional income for a KAG through ESG-compliant assets
Early implementation of all measures not only ensures more efficient and sustainable properties, but also generates Additional income for a KAG through the sale of solar power. Long-term and favorable electricity supply contracts (on-site PPAs) with the tenants on site and intelligent solutions for distributing surplus electricity to neighboring companies thus ensure increasing returns. Consumers also save on electricity tax and grid charges. Thanks to intelligent excess power distribution (IEPD™), the surplus PV electricity can even be distributed throughout Germany.
Clever operator models: Preserve investment fund tax advantages & operate assets in an ESG-compliant manner
A property company of a KAG, which only performs asset management activities such as letting and leasing, are in Germany tax-privileged and solve No trade tax out. However, the operation of photovoltaic systems and the sale of solar power lead to "commercial activity". Through this Trade tax infection all income - including the originally tax-free income - becomes subject to trade tax. To avoid this, a clever operator model must be chosen, such as Contracting with a subordinated easement. This enables a KAG to continue to benefit from tax advantages, maintain the flexibility of its properties and at the same time ensure long-term attractiveness as well as economic and tax potential for investors and tenants.
Resolving the tenant/investor dilemma of a KAG
The balancing act between high investments, short-term profitability and long-term sustainability poses another challenge for investment companies. Initially, only the tenants benefit from modern, energy-efficient and ESG-compliant assets. However, the necessary investments are usually made by the investment company. This Tenant/investor dilemma of investment and real estate asset companies can be easily resolved with a holistic strategy. Modernization measures such as PV systems, battery storage, charging infrastructures or modern heating and air conditioning systems can be implemented without having to make any investments of your own. Contracting procedure be implemented. Tenants benefit from modern, energy-efficient buildings and investors from risk-free returns, an enhanced reputation and an automatic increase in the value of the assets.
Avoid stranded assets of a KAG
Older existing properties with low energy efficiency classes (E-H) in particular, which make up 58.1 % of the building stock in Germany, already have a high risk of becoming stranded assets. They are can hardly be refinancedlose value, generate low sales proceeds and are only rentable to a limited extent. The Portfolio devaluation without extensive energy-efficient refurbishment is the logical consequence.
National and international standards such as ISO 14040, EN 15978 and DIN 276 are also tightening the requirements for ecological standards. The EU Buildings Directive (EPBD) requires Climate-neutral new buildings by 2030 and extensive refurbishment of existing buildings. Regulations such as the CSDDD and the Building Energy Act (GEIG) oblige companies to adopt sustainable construction and supply chain practices. Banks and investors are increasingly focusing on ESG criteria and the EU taxonomy, which prioritizes the financing of sustainable projects.
Violations of regulations or directives result in Fines, Sales and rental bans for inefficient real estate and Fines of € 100 per tonne of CO₂ equivalent exceeded. In addition to financial damage, there is also the threat of considerable reputational damage, which reduces market opportunities in the long term.
Innovative solutions such as energy efficiency measures and the use of sustainable energy sources not only avoid such penalties, but also contribute to an overall increase in value and profitability. They therefore avoid stranded assets and can also be implemented by KAGs without investment.
ESG-compliant assets without additional effort
In Germany, new buildings are subject to an almost nationwide Solar obligation for real estateThey are also increasingly being prescribed for the renovation of existing buildings. In order to increase the energy efficiency of their assets and integrate PV systems efficiently, KAGs should rely on experienced partners who implement projects using the contracting method. The partner takes on the planning, implementation and operation, while the KAG no CapEx or OpEx are incurred. From handover in the condition PV-Ready to turnkey realization (Ready-to-Build), the partner company ensures the smooth running of the Operation as well as the ongoing optimization and marketing of the surplus electricity generated. This allows KAGs to concentrate on their core business, while the partners take over the energy modernization.
Smart energy solutions through integrated partner programs
A comprehensive partner program, such as that offered by CUBE CONCEPTS for investment companies, creates sustainable added value for all parties involved and ensures ESG-compliant assets. Without own investments or ongoing operating costs, such a partnership increases the attractiveness of the properties. The use of modern technologies increases energy efficiency and generates additional income. Tenants benefit from lower energy costs and the integration of innovative energy solutions, such as a charging infrastructure or battery storage systems, creates a modern and sustainable environment that increases user comfort and satisfaction.
Thanks to the partnership-based implementation, investors enjoy a risk-free model that enables stable returns, long-term predictability and an increase in real estate value. The ESG-compliant focus and the reduction of CO₂ emissions also enhance the reputation and market appeal of the investments, which guarantees a future-proof investment.
Another decisive advantage lies in the savings potential of CO₂ certificates. As buildings emit significantly less CO₂ thanks to the installation of photovoltaic systems and other energy efficiency measures, the cost of purchasing CO₂ certificates falls considerably. This is not only a financial benefit, but also helps to meet legal requirements and avoid future cost increases for CO₂ certificates.
Sustainable investment fund portfolios through ESG-compliant assets
Investment companies are at a turning point: ESG-compliant real estate is no longer just an option, but a necessity. Necessity to remain competitive in the long term. Innovative solutions such as photovoltaic systems, energy efficiency measures and smart operator models make it possible to successfully overcome these challenges. In doing so, KAGs can benefit not only from savings on CO₂ certificates and the avoidance of trade tax disadvantages, but also from increased profitability, value retention and the attractiveness of their properties.
With strong partners who take on comprehensive modernizations and operating concepts in the contracting process, it is possible for KAGs to meet ESG requirements without having to bear CapEx or OpEx. This minimizes risks and expenses, while at the same time optimally exploiting economic and ecological potential.
By combining ecological responsibility, economic efficiency and increased market value, the sustainable transformation of the portfolio becomes a win-win situation for all parties involved: investment companies, tenants and investors. Only with such future-oriented strategies can investment companies meet the increasing demands and secure their market position in the long term.