InvestEU in Germany: EIB supports social and affordable housing in Hanover with €60 million
The European Investment Bank (EIB), backed by the new InvestEU programme, is lending €60 million to the municipal housing provider hanova. The loan will support hanova’s construction programme of social and affordable housing in the city of Hanover, which will also meet the European Union’s high energy efficiency standards.
Hanova has been Hanover’s housing company since 1927 and owns around 15 000 housing units. The company supports the city’s housing policy, in particular in building new social and affordable flats for rent. The project involves the construction of 640 new units, of which 232 are social and 408 are affordable housing units.
This project is the first in Germany to receive a loan by the EIB under the new InvestEU programme. Thanks to the InvestEU guarantee from the EU budget, the EIB will be able to fill a financing gap offering an unsecured loan with a very long maturity.
Hanover, the capital of the federal state of Lower Saxony, has a growing economy and attractiveness as an urban centre, with a quickly expanding population and therefore rising demand for housing. As in many urban areas across Germany, rents have risen sharply in recent years. The project will help address the imbalances in the local housing market by providing adequate and affordable housing for local low and medium-income residents. In Lower Saxony, the income threshold for social housing is €23 000 a year for a two-person household.
The hanova project is also energy efficient: 82% of the buildings will achieve an energy performance that will be at least 20% better than the German nearly zero-energy building standard (KfW 55). The rest will target an energy performance of at least 10% better than this standard. The project is also aligned with the EU Energy Performance of Buildings Directive.
The project is therefore fully compliant with the EIB’s climate action and environmental sustainability objectives. It will help to reduce CO2 emissions in buildings and support Hanover’s efforts to become climate neutral. It will also contribute to social inclusion and provide people on low and middle incomes with greater housing options to live in the city.
Valdis Dombrovskis, Executive Vice-President of the European Commission for an Economy that Works for People, said: “This agreement is an excellent example of how InvestEU can contribute to achieving our shared social and green objectives while having a positive and meaningful impact on the lives of our citizens. This is the first project supported by InvestEU in Germany and will make 640 new social and affordable homes available in Hanover that will meet high energy efficiency standards.”
EIB Vice-President Ambroise Fayolle, who oversees activities in Germany, welcomes the project: “Together with hanova, we are demonstrating that even energy-efficient new builds do not always have to mean high rents. We are proud that this project will help to sustain and grow a vibrant city.”
Director of hanova Karsten Klaus agrees: “We are pleased to have found a partner in the EIB who will support hanova in its goal of providing the city of Hanover with affordable, energy-efficient and sustainable new housing.”
Hanova-CEO Karsten Klaus agrees: “We are pleased to have found a partner in the EIB who will support hanova in its goal of providing the city of Hanover with affordable, energy-efficient and sustainable new housing.”
The InvestEU programme provides the European Union with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It also helps mobilise private investments for EU policy priorities, such as the European Green Deal and the digital transition. The InvestEU programme brings together under one roof the multitude of EU financial instruments currently available to support investment in the European Union, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub, and the InvestEU Portal. The InvestEU Fund is implemented through financial partners who will invest in projects using the EU budget guarantee of €26.2 billion. The entire budgetary guarantee will back the investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment.
The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals. The EIB’s activities focus on the following priority areas: climate and environment, development, innovation and skills, small and medium-sized businesses, infrastructure and cohesion. The EIB works closely with other EU institutions to foster European integration, promote the development of the European Union and support EU policies in over 140 countries around the world.
As a municipal group, hanova is helping to shape the urban development of Hanover in order to make the state capital more lovable and liveable. In doing so, economic success and social responsibility are always balanced. As the largest real estate service provider in Hanover, hanova manages residential and commercial premises, builds schools and kindergartens, creates parking spaces and actively develops the city every day — with Hanover heart and real estate understanding.