In conversation with Ralph Büchele

Learning from the ground up

Ralph Büchele has always been interested in construction and real estate, which is why he got involved early on. After studying civil engineering, he worked in an engineering office for 23 years. He then worked in management consultancy and finally found his way to BayernHeim as Managing Director, where he specializes in subsidized housing construction.

“Rents must be reasonable”

When asked what actually constitutes affordable housing, he replied that rents should generally not exceed 30-40% of income — in many German cities, this well-known rule of thumb is barely achievable. “As a rule, we are almost 50% below the market rent in a location, which means there is a considerable difference to what is normally payable.” But how is this actually possible? “It's because of the subsidies provided by the Free State of Bavaria, which supports tenants accordingly, and that's why it's called affordable housing or subsidized housing.” Of course, this project is not always that simple. Nevertheless, BayernHeim is finding ways to exploit synergies by working closely with local authorities, cities and municipalities and emphasizing the benefits for both parties: “On the one hand, we get access to relevant properties, and on the other, we ensure that subsidized housing is also built at the location, which in turn benefits the city's community.”

Collaboration instead of competition

Büchele does not see himself as a competitor to private investors. On the contrary: He believes that cooperation and collaboration are important and beneficial for neighborhood development. “We will not be able to solve the housing shortage that we have in Bavaria or in Germany through subsidized housing alone, but we also need privately financed, private housing construction. [...] And I think these neighborhood developments have an incredible advantage, because they can of course calculate in a completely different way. [...] They can implement completely different concepts with such large development measures — in terms of energy supply, in terms of the mobility concept, and they can actually achieve much more in terms of architecture and urban development,” says Büchele.

Sustainability, but sensible

As a company that focuses on new construction, only projects that meet at least the KfW 55 standard are implemented. BayernHeim also integrates photovoltaic systems, sustainable mobility concepts and greenery. However, Büchele emphasizes that their work is not driven by ideology, but by looking at what makes sense, also in terms of ESG criteria. However, he considers some measures or specifications in the area of sound insulation or fire protection to be overpriced. “I would say that you could save 30% of the construction costs without really losing any significant quality, because as a building owner I can't afford to compromise on quality anyway. [I keep the properties in my portfolio for 50 years or more - I'm not selling them, which means I'm intrinsically motivated to build to a high standard.”

Digitalization as an exciting area

Büchele sees a lot of potential for digitalization in the real estate sector — especially in building technology. “I always say: I don't need smart homes. I'd rather bring intelligence into the boiler room, because it's dark there and, above all, it's terrible when you look at everything that's installed there. And with a little more software instead of a lot of hardware, you can generate a lot, just through intelligent heating control.” This could also reduce costs and increase efficiency.

Construction costs must come down

When asked where he thinks the biggest changes need to be made, Büchele mentions construction costs. “I think that's the key. We don't have the issue that the financing costs are so high. I don't think we have the problem that there is too little funding either. We have a lot of funding instruments at federal and state level, and at some point they are just exhausted.” Instead, the government should trust in the building owners and their expertise and ability to make the right decisions. With the so-called building type e, Germany is already on the right track. He adds: “The moment we reduce construction costs by 20, 30 %, the market picks up again immediately. People are building again, it's economical to build again, building is fun again and we can get a grip on the problem of not building enough housing.”