Good morning, dear readers,
The Luisenblock West of the German Bundestag is one of the more successful construction projects in the capital: the seven-storey building with offices for members of parliament was handed over to the federal government in 2021 after a construction period of less than 15 months, a month earlier than contractually agreed.
The special feature: The “Luise” consists almost entirely of prefabricated wooden modules – and should no longer be built in this way today. According to the amendment to the model timber construction guidelines that came into force in 2022 (probably familiar to you as M‐HolzBauRL), the wood on the interior walls should now be hidden behind plasterboard. This is what our capital city reporters Heike Anger and Silke Kersting report, who have been looking for reasons for the state of shock in Germany’s real estate industry.
One of them: more and more complex building regulations are now making new buildings so expensive that in many places they are no longer economical. The rest is taken care of by high interest rates, a shortage of skilled workers on construction sites and increased material costs. We analyze this “new building nightmare”. in our Friday title.
Caution, new construction: Building in Germany is currently like a nightmare.
Not only the real estate group Vonovia has stopped all new construction projects. Many smaller property developers and private builders are now also building small bricks – or canceling their construction projects altogether. And Housing Minister Klara Geywitz (SPD) will fall far short of her party’s election promise of 400,000 new homes per year. She demands more productivity from the construction industry: “I ask you, can you think of another industry where production technology hasn’t changed in the last 15 years?”
Yes, more innovation and productivity are always a good thing. How has the productivity of public building authorities actually developed over the past 15 years?
Bill Gates has a lot to say about productivity. It was probably just the right week to talk to the Microsoft founder about artificial intelligence and its impact on the world of work. Microsoft is preparing to initiate the next digital revolution in association with the start-up OpenAI – the voice assistant ChatGPT is the first visible sign of this revolution.
Gates forecast: “We will definitely need fewer typists because the documents are now writing themselves. The software also automates some activities performed by assistants.”
He doesn’t see this scenario as a threat – rather as part of a solution. In an interview with Handelsblatt editor-in-chief Sebastian Matthes, Gates says: “In view of the aging society and the lack of skilled workers, we have to make workers more efficient. This is where the AI will bring relief. And in the distant future we really will have to work less than we do today.”
You can hear the interview in the latest issue of Handelsblatt Disrupt. Or read it here.
Ukraine President Volodymyr Zelenskiy traveled from Paris to Brussels yesterday. There he was welcomed with warm words and much applause as a guest in the EU Parliament and at the EU summit.
Today is a test of solidarity with Ukraine that has received comparatively little attention. On the initiative of Great Britain, more than 30 nations, including Germany, are discussing a joint reaction to the announcement by the International Olympic Committee (IOC) that they want to allow athletes from Russia and Belarus to take part in international competitions again under certain conditions.
Above all, it is about the Olympics in Paris next year. “The fact that the IOC is apparently opening the door again to Russian athletes and wants to enable them to take part in the Olympic Games is completely the wrong way,” Federal Interior Minister Nancy Faeser said at the end of January.
The IOC is aiming for the return of athletes from Russia and Belarus, provided they do not compete under their country’s flag and do not actively support the war in Ukraine. The Ukraine even threatened to boycott Paris.
When it comes to investing, one iron law generally applies: no matter how much profit you are happy about with European shares – you could have earned more on Wall Street. In the long run, US stocks actually always deliver better returns than European stocks.
Things can sometimes look different in the medium term, and we are currently going through such a phase. The broad European stock index Stoxx Europe 600 has gained around 19 percent since September, the leading US index S&P 500 just under 15 percent. Since mid-January, however, US stocks have again gained more than their European counterparts. Is the Europe hype already over?
Many investors say no. According to a recent study by the US bank Goldman Sachs, “The outperformance has not yet been exhausted.” According to experts, there are three reasons for the better performance of European shares:
- First, the economic prospects for Europe have improved disproportionately.
- Second, European stocks are considered undervalued compared to US stocks.
- Third, there is catch-up potential because investors previously withdrew a lot of money from Europe.
Small blemish: All three arguments for the strength of the European stock market have to do with its previous weakness. But investors who want to bet on a bit of an increase in returns over the coming months need not worry about that for the time being.
And then there is Henrik Thiele, son of the billionaire industrialist Heinz Hermann Thiele (Vossloh, Knorr Bremse), who died in 2021. Even after a defeat in the Munich I district court, Thiele junior wants to continue fighting for his inheritance, which he waived in 2017 for a comparatively clear payment of 25 million euros. His lawyers announced an appeal. Henrik Thiele was urged by his father to enter into the agreement in an inadmissible manner.
The reason for the rift between father and son was apparently an article in the business magazine “Bilanz” in 2015. Henrik is said to have met with the magazine without his father’s knowledge. He was then described in the story as “charming”, “intelligent” and “versatile”, Heinz Hermann as “pithy” and “difficult”. The senior was “obsessed with controlling and inspecting everything.”
Anyone who knew the old Thiele will be able to understand this characterization. But that didn’t help: After the article appeared, his father wanted to “destroy” it, according to Henrik Thiele in the complaint.
I wish you a robust Friday without losing control.
Best regards
Your Christian Rickens
Editor-in-Chief Handelsblatt
