A new start for the real estate sector

Housing Europe supports the joint letter to the European Commission

Brussels, 1 April 2015 | Published in Urban, Economy, Social

President Juncker and Vice-President Timmermans

Housing Europe along with some of its members, Aedes and USH have decided to be part of an ad-hoc coalition of 41 (inter)national associations asking the European Commission to develop a coordinated approach towards the real estate & built environment sector.

Members of the above mentioned diverse coalition sent on Monday, March 30th a letter to the European Commission President, Jean-Claude Juncker and First Vice-President, Frans Timmermans. A further 13 European Commissioners were in copy of the letter, covering all relevant remits. In the letter, all signatories stressed the importance of the real estate & built environment sector in terms of economic growth, jobs and sustainability that is not reflected in the political priorities of the EU Institutions.

You may read the letter below:

Monday, 30 March 2015

Dear Mr. Juncker

Dear Mr. Timmermans,

The European Commission work programme for 2015 sets out a new start for Europe. As representatives of the undersigned associations which are all active in diverse parts of Europe’s real estate sector, we want this new agenda for change to prioritise a new start for our sector; to reflect an awareness of the important role our sector plays, one that is critical to the EU’s economy and its citizens. It is time for a high level EU dialogue and strategy for Europe’s real estate sector.

Commercial property alone contributed EUR 302 billion to the EU economy in 2013; almost double the contribution of the automotive or telecommunications sectors. The total value of residential housing in the EU is estimated to be approximately EUR 24 trillion. Investment in housing, other buildings and infrastructure totals more than EUR 1 trillion, when included with commercial property it represents 55% of capital investment in the European economy. According to Eurostat, around 1.1 million enterprises, many of which are SMEs, operate within our sector, employing around 2.6 million people.

Beyond these figures, the real estate sector plays a vital role in every aspect of the European economy, society and environment. Businesses and society cannot function without the services of commercial property, including the provision of offices, shops, factories and many other forms of real estate. In the residential sector all citizens have a right to decent and affordable housing. Buildings are where people live, work, learn and play. The built environment is of central importance to public health, productivity, quality of life, educational standards and cultural heritage.

Despite the sector’s importance, it is not currently a central focus in either the Commission work programme or the Juncker Investment Plan. Infrastructure is part of the programme, and given the strong connection between buildings and infrastructure, and particularly between efficient buildings and a decreased need for new energy infrastructure, we believe the real estate sector at large is not given sufficient priority. We urge the Commission to address this.

A significant amount of EU legislation impacts our sector. Issues relating to finance, taxation, fair competition, investment, energy, sustainability, services of general interest and professional services are at the forefront of the Commission’s agenda today. Recommendations in the Annual Growth Surveys and country-specific recommendations as part of the European Semester touch both directly and indirectly on policies impacting the real estate sector. However the approach of EU policy development for the sector is neither strategic nor coherent. We would like to work with the new Commission to change this and set out a clearer narrative and goals to enable the sector to fully respond to our shared challenges.

We believe that as a first step, leadership on a sector strategy must be identified within the Commission, to provide professionals, industry, the public sector and stakeholders with a central point of contact. Subsequently, this leadership needs to host a truly cross-sector dialogue, building upon existing and previous sector-related initiatives, but aimed at agreeing a more comprehensive and long-term strategy for the real estate sector across the Commission.

To help shape this dialogue, we believe a sector strategy could be structured around the following indicative list of themes that are of universal concern to actors in and affected by the sector:

Financial Opportunities: The significant value of the real estate sector to the EU economy and its role in the economic recovery.
Job Creation: The sector’s large potential for job creation and the further development and mobility of professional services.
Sustainability: The full capacity of sustainable buildings to improve occupant health, wellbeing and productivity and make the largest single contribution towards the EU’s energy and climate goals.
Market and Regulatory Stability: The importance of a stable, transparent, balanced and well-functioning real estate market for owners, tenants, investors and professionals in the sector.
Buildings and Infrastructure: The intrinsic relationship between buildings, urban and rural development and critical infrastructure such as transport and energy.

A healthy and well-functioning real estate sector is important for jobs, growth and investment as well as mobility. Its complexity and scale requires a coherent and well-informed approach by European legislators. We call for an ambitious and strategic and long-term approach to the real estate sector in the EU that recognizes the importance and diversity of the sector, and which results in coordinated policy measures that support sustainable economic growth, whilst respecting the principles of subsidiarity.

We recognize cooperation between the sector’s diverse actors is key to the development of coherent and strategic policy. Therefore, as representative bodies in the sector, we request a meeting with you to introduce the shared views of a diverse group of organisations which are all able to find common ground in their call for an EU real estate sector strategy.

The members of our different organisations are involved in commercial and residential real estate (including private and social rental housing) as well as construction as representatives of professionals, owners, tenants, investors and the construction industry, both SMEs and larger firms. Collectively we firmly believe that it is time to give the real estate sector as a global sector attention as a matter of priority at European level.