what is smart?

What is

SMART?

ANNUAL REPORT 2017

Volume data 2017 2016 Change (%)

Number of own apartments 9,175 9,131 + 0.5

Residential space (m2) 613,281 608,986 + 0.7

Number of commercial properties 194 186 + 4.3

Commercial space (m2) 398,431 365,611 + 9.0

Employees incl. trainees, annual average 354 340 + 4.1

Employees incl. trainees at year end 357 353 + 1.1

Financial information (€ m)

Revenue 156.29 158.15 – 1.2

Operating profit 41.39 35.50 + 16.6

Profit before tax (IFRS) 35.57 30.25 + 17.6

Profit after tax (IFRS) 24.34 21.33 + 14.1

Fixed assets 587.92 595.51 – 1.3

Investments 27.74 68.40 – 59.4

Total assets 653.38 647.68 + 0.9

Cash flow from ongoing business 51.08 40.33 + 26.6

Gross cash flow 53.85 45.39 + 18.6

Key figures (%)

Return on sales before tax 22.8 19.1 + 19.0

Equity ratio 35.7 36.5 – 2.2

ROI 4.9 4.2 +16.7

Year-on-year comparison 2017

of key figures

* VWI new customer survey, carried out between January 2016 and December 2017

** where their jobs allow it

of customers who rent

an apartment from VWI

feel that they are well

looked after *

98%

of managed rental space

for Volkswagen AG and

subsidiaries

1.7 million m2

employees sometimes

undertake mobile work **

3 out of 4

Thinking of real estate and mobility as one. Making visions reality. Consolidating knowledge, passing it on and creating enthusiasm for new approaches. That is SMART.

CONTENTS

Think new:

In conversation with the VWI directors

Real estate financing and sustainability:

Green financial products that

preserve the Group’s liquidity

Employees:

Flexible work is SMART

Visionary new building with an 800 V charging

station: The Porsche Centre Berlin-Adlershof

Hello, auto mile:

VW and SEAT share a branch office in Stuttgart

IT:City:

A core element in Wolfsburg

SMART office space:

X Center@IT:City

Innovations:

SMART is thinking of real estate and mobility

as one

Making a vision reality:

Construction begins in Steimker Gärten

SMART architecture:

Construction projects in Steimker Gärten

More homes:

Housing by VWI

SPLACE:

Work begins on 60 new business apartments

Global Inn:

A new look for the hotel

Facts and figures:

VWI financial year 2017

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> ANNUAL REPORT 20172 3

MANAGEMENT INTERVIEW

Think new

The years 2015 and 2016 were challenging ones for the

Group, and therefore for Volkswagen Immobilien, too.

How was 2017?

MENO REQUARDT > We moved a step forwards in 2017.

We picked up the pace again in the commercial real estate

segment. Space is in demand. Important decisions are to

be made within the Group and Volkswagen Immobilien is

deeply involved in these processes.

MICHAEL LEIPELT > As for the residential real estate

segment, the new residential construction programme

continued in 2015/16. This shows how increasing

location and employer

attractiveness remains a

key priority. It even tran-

spired that the defined

investment framework

of € 100 million can

be increased if return

ex pectations are met.

DR. RALPH SAWALSKY >

I am very happy that our

company result developed positively on the whole. We

exceeded our targets – even though we launched an effi-

ciency programme costing € 8 million at the start of 2017.

Can a financial product be SMART

Is there a SMART way to organise mobile work?

Is curiosity SMART?

The VWI directors discuss past strengths and new perspectives,

the challenges of internationalisation and sustainable value creation

in times of change.

MENO REQUARDT > We may have met these requirements,

but we cannot rest. We will continue to work on efficiency

in 2018/19, guided by the Together 2025 programme.

We’re on the right path.

A major topic in 2017 was alternative forms of financing.

What are the advantages?

DR. RALPH SAWALSKY > We at Volkswagen Immobilien

are very proud that we raised our own financing for the

first time, to the tune of € 200 million for the full year

in 2017. This allowed us to reduce our interest burden by

€ 8.5 million. We are now more independent, the liabilities

we finance through Volkswagen Treasury tend to be short-

term and they therefore put less of a strain on the Group’s

credit line.

>

Location attractiveness is

more important than ever to

the Volkswagen Group. MICHAEL LEIPELT


You have also worked on sustainable financial products.

DR. RALPH SAWALSKY > Yes. We have been working on

fixed-interest promissory note loans that we secure

against valuable real estate – exclusively properties that

meet our Group’s BLUE BUILDING standard and help to

reduce CO2 emissions. Here, we are tapping into new

groups of investors, such as institutional investors, that

have undertaken to include ethical financial products in

their portfolios in particular. The German Central Bank

has already confirmed our eligibility for central bank

credit, and we may now issue securities. We also reached

another milestone at the end of 2017 when Volkswagen

Immobilien received a prime rating from oekom re-

search AG, a leading global rating agency in the field of

sustainable investments. Only 10% of all real estate

companies assessed have

received this quality status.

Volkswagen Immobilien is

therefore positioning itself

as a SMART pioneer.

Your buildings in Steimker

Gärten are being constructed

to the BLUE BUILDING

standard. Are any properties

available for purchase? How

do you choose investors?

MICHAEL LEIPELT > There are 20 plots in the first con-

struction section. We’ve already sold 11 of them and

decisions are to be made for a further seven plots. The

other two plots have been for sale since February 2018.

As for our business partners, we’re looking for credit-

worthiness, reliability and credentials. But they also have

to share our vision; they have to want to set standards

with us in making Steimker Gärten an attractive quarter

and living lab.

We are living in times of great change. Projects such as

Steimker Gärten and the successful IT:City are great

examples of this. How is Volkswagen Immobilien inte-

grated into the Group when it comes to innovation

management?

MENO REQUARDT > When we talk about digitisation, new

forms of mobility and the electrification of cars, it be-

comes clear that all of these topics are found at the same

place. At Volkswagen Immobilien, we have always thought

in terms of spaces and aim to offer SMART support to the

Group in new ways. A good example is quarter planning,

which involves charging infrastructure, payment systems,

mobility and robotics. We don’t have expertise in all of

these fields, but can be approached at any time via our

innovation department when it comes to trying out new

ideas. Being curious and remaining curious – that’s

important to us. We work closely with the Group’s

innovation drivers, including VW Kraftwerk GmbH in

relation to power supply ...

MICHAEL LEIPELT > … and we are in talks with the

components division about the cooperation around

battery buffers.

MENO REQUARDT > Actively shaping these future

issues from a real estate perspective and bringing all

relevant project partners together is both a challenge

and an essential ingredient.

Real estate and mobility

are becoming one. SMART

is staying on the ball. MENO REQUARDT

>

Besides digitisation, internationalisation is also a key

issue operationally.

DR. RALPH SAWALSKY > Internationalisation has made

strides in the corporate real estate management segment.

In 2015 we have started with the realization of a logistic

center in Bratislava, Slovakia,

and were able to hand it over

in 2017. Next to further tasks in

Poland we are also engaged

in an intensive dialogue with

Skoda in the Czech Republic.

MENO REQUARDT > We also

have excellent relationships

within the Group thanks to our

core competence of lease

management and are involved in various overseas

proj ects. We also took on new projects in India and

Malaysia in 2017.

A lot has happened internally at Volkswagen Immobilien

as well. You are moving from a culture of presence to a

culture of execution. How has that changed how you

work together?

MICHAEL LEIPELT > There have been many great

changes, including the abolition of the time clock, the

introduction of trust-based working hours, the expansion

of flexible working hours and contractual regulations on

mobile work. We faced some scepticism. Our SMART

linking of mobile work and corresponding team agree-

ments was the key to success. Our model quickly set

a precedent and the Group showed a lot of interest in

our approach.

Tell us about financial year 2018. What will Volkswagen

Immobilien focus on?

MICHAEL LEIPELT > In the residential real estate segment,

the construction work in Steimker Gärten and the devel-

opment of the second construction section will keep us

busy in 2018. We will also market owner-occupied apart-

ments on behalf on some investors, further highlighting

our extensive commitment to the quarter.

MENO REQUARDT > In the commercial real estate

segment, we are looking forward to exciting new projects

both in Germany and abroad. Volkswagen Immobilien will

support the Group in 2018 as a stable partner, a service

provider and an investor with a 360-degree perspective.

The diesel issue affected all of us, but we have regained

our confidence. It’s time to roll up our sleeves and get

down to business.

DR. RALPH SAWALSKY > As far as internationalisation is

concerned, in 2017 we grappled with currency issues,

international tax law and corresponding accounting

decisions. This is all based on a strategy process that we

will complete in 2018. A key element in this context is

sustainability. Thinking holistically about all value creation

levels in relation to planning, financing, constructing and

operating real estate is key to tomorrow’s success.

We have made many changes

and have achieved a high

level of self-organisation.DR. RALPH SAWALSKY


COMPLETED AFTER THREE YEARS

Comprising 630,000 m of copper data cable,

47,300 t of concrete, 50 km of heating

and cooling pipes, IT:City was officially

opened in Wolfsburg-Kästorf in May 2017

and offers ultra-modern working conditions

for 1,500 employees. This is the home of

the Group’s Digitisation unit; this is where

Group IT’s heart beats. As contractor,

Volkswagen Immobilien was responsible

for the development and implementation

of the project.

IT:City. SMART for tomorrow

As one of the central locations of the Volkswagen Group’s

IT and digitisation expertise, IT:City is a key part of the

future strategy – an attractive office building that provides

IT and software experts with all opportunities available to

put new forms of cooperation into practice.

Six wings over an area of almost 55,000 m²

The interior design of the campus-style office complex

features work islands, meeting points, fully connected

conference rooms and opportunities to retreat to focus on

work that consistently meet the requirements of the agile

development processes in the IT sector. Specialists in the

most varied of departments can get together quickly, allo-

cate responsibilities and organise themselves using work

methods such as Scrum. The aim is to keep development

and test cycles as short as possible.

Group IT’s Smart.Production:Lab (SPL) – which focuses

on the digitisation of production and logistics – also has

ideal working conditions at IT:City. It works on station-

ary and mobile robotics in the areas Intelligent Robotics

and Future Production Ecosystem and, to this end, has a

technical area at IT:City where prototypes or test vehicles

can be built, for example.

A modern, barrier-free property with innovative office space and accessible courtyards to the south – plus a spacious restaurant building, 1,250 parking spaces and 300 bicycle racks.

Group IT drives digitisation at Volkswagen.

That should be obvious at our new central location

in Wolfsburg. IT:City offers our employees the ideal

conditions for agile, modern work.

DR. UWE MATULOVIC,

Managing Director at Volkswagen Group IT Services

Smart facility management by VWI

From a construction perspective, the technical challenges

were enormous and future-proof planning was of signifi-

cant importance – not least in relation to the sustainable

operation of IT:City. Two district heating stations therefore

supply the building complex with minimal heat loss, and

four cooling units create a pleasant indoor climate that

can be controlled by employees.

Volkswagen Immobilien is responsible for the property’s

technical maintenance, with all options available for

remote maintenance; the building’s facilities are in large

part SMART and can be quickly and efficiently accessed

and controlled via a secured network when required.

For us in the Smart.Production:Lab,

it is important to try out ideas and

digital solutions and also to build

prototypes ourselves for experimen-

tal purposes. IT:City offers ideal

conditions for this with its short

communication channels and our

technical area.

DR. WOLFGANG HACKENBERG,

Head of the Smart.Production:Lab at IT:City


NEW WORKPLACES@VOLKSWAGEN GROUP

Everyone’s talking about the future – the future of industry, the future

of work, the future of mobility. But how is the future actually made?

And what is the role of the work environment?

Manuela Lieber and Andrea Schmidt take us through X Center@IT:City –

an example of New Workplaces@Volkswagen Group.

X Center@IT:City – A pilot project for new work environments

MANUELA LIEBER (right), Project Manager for New

Workplaces@Volkswagen Group from the Digitisation unit,

Business 4.0 and ANDREA SCHMIDT (left), who coordinates

this project for Volkswagen Immobilien.

New Workplaces@Volkswagen Group

‘New Workplaces@Volkswagen Group’ was initiat-

ed as part of a collaboration between the central

units HR Strategy and Digitisation Business 4.0.

Manuela Lieber heads this project together with

Thomas Rühl from the HR Strategy unit. The

aim is to create spaces that improve communi-

cation and stimulate creativity, and to create

offices that contribute to employee satisfaction

and increase productivity. Test projects are being

carried out internationally with the involvement

of the Volkswagen Group’s brands, including

Volkswagen Pkw, Volkswagen Nutzfahrzeuge,

Volkswagen Financial Services, Porsche, Audi,

Škoda, SEAT, Bentley, MAN and Scania. Brands and

Group departments learn from one another and

gain experience in offices and labs. Volkswagen

Immobilien is also involved. The aim is to create

a ‘cookbook’ that defines uniform principles

for the Group that provide guidance for future

construc tion and conversion projects.

An initial glimpse into the first floor of wing 1 reveals the

rustling of paper and the sound of typing. Desks are

grouped together and eyes are focused. There are voices

here and there, brief discussions, quick feedback, then

quietness, the rustling of paper and the sound of typing.

The music of the future is surprisingly quiet.

> It’s actually rather quiet in our office, says Manuela

Lieber. > If there’s a lot to discuss or if a larger team meets,

colleagues can use the meeting rooms spontaneously.

The glass cubes each have a large screen and walls that

can be written on. Drawn on them are workflows, ideas

and statements such as ‘If everyone thinks the same, then

no one is thinking.’

Wanted: creative thinkers

The Digitisation unit helps to design transformation

processes within the Group. New business models are also

developed, including innovative mobility solutions, for

example. Manuela Lieber opens her laptop and shows a

chart: > We focus on people. Digitisation helps us to

understand what interests them and what benefits them

as consumers. It is a driver: it includes everything, and

connects and links everything.

Sixty-four colleagues work at the X Center over an area of

some 1,000 m² – an office landscape tailored to the unit’s

specific workflows and methods. > Coordination process-

es are very intensive here. Our work is interdisciplinary,

involving many participants, and our communication must

reflect this. This has radically changed our work and the

requirements of the working environment and we are, to

some extent, breaking with convention here. The X Center

allows us to try new things.

Individual offices with anterooms are nowhere to be seen.

The management level around Chief Digital Officer

Johann Jungwirth has gone without them – instead,

managers sit directly with their teams.

Manuela Lieber takes a sticky note and draws paths: > We

wanted to create a space that inspires, motivates and

unlocks creativity. To do so, it was important to include

various perspectives. Falk Bothe, Head of the Digital

Transformation Office, managed the X Center project

and the concept was developed and implemented as

part of a collaboration with the Volkswagen Service

Factory and realized by Volkswagen Immobilien. For us,

it’s an important pilot project in the context of New

Workplaces@Volkswagen Group – a topic that all Group

brands are dealing with.

Andrea Schmidt nods and points towards the organically

meandering office landscape. The open design creates

new vistas time and time again, wooden flooring alternates

with natural rubber flooring, cable runs and ventilation

pipes are exposed, lights hang from the ceiling like small

clouds. It doesn’t quite seem finished – like a workshop. >

The specific requirements of the Digitisation unit played

a key role in the development of the X Center. An analysis

of widely varying job descriptions and activity profiles

provided guidance, revealing that work today is more

mobile than ever, and spontaneity and agility are decisive

factors. This gave rise to scenarios for the space that offer

exceptional diversity. Successful office concepts are not

only based on specific needs – sound ‘change manage-

ment’ and the involvement of employees also play a key

role and are critical to the cookbook’s success.

There’s something to suit all tastes – for focused work and

for short breaks. Brightly coloured sofas form a highlight

here and there. Andrea Schmidt runs her hand over the

fabric and looks into the space: > Fixed computer worksta-

tions obviously still exist, but so do telephone booths and

touch-down spaces to quickly check email, for example.

The X Center is testing in real-life conditions what is

accepted and what works, and what isn’t and doesn’t.

Illustrating new paths

New space for new work – new space for a new genera-

tion. Manuela Lieber highlights the importance of collabo-

ration, communication and meetings between equal

partners – even across hierarchies: > If we change the

space, we are to some extent also changing the culture.

Who sits where? How can materials, spatial design, forms

and colours be used purposefully? At the X Center, we

notice that all of this affects the working atmosphere

and all of this means change. We would like to make these

changes carefully and deliberately. The entire team

is involved.

What’s next?

> The X Center is providing us with valuable insights. We

want to take the positive experiences that can still be

improved and use them for the processes and approaches

in the New Workplaces ‘cookbook’. This is because we’re

ultimately looking to create the framework conditions for

new working environments across the Group and there-

fore initiate the change process and get the ball rolling.

The tour ends and one last listen reveals the rustling of

paper and the sound of typing: the music of the future is

still playing. One last look confirms digitisation is changing

everything – and it looks good here.


TOPIC

01

INNOVATION MANAGEMENT

If mobility changes, the city changes.

REQUARDT > When we talk about housing, we’re talking

about a basic need, a human constant. It’s true though

that cities are changing. If, in a few years, cars can park

themselves or there are fewer vehicles in city centres as a

result of new mobility services, we won’t need as many car

parks. This gives rise to new opportunities to design and

reinvent quarters.

JUNGWIRTH > There’s a good reason our MOIA

ride-pooling concept claims to give part of the city back

to the people.

REQUARDT > The MOIA service test in Hanover caused

a sensation in 2017. It’s clear that new forms of mobility

are very exciting.

SCHMITZ > It’s because topics such as quality of life are

so important today. The car-friendly city was a synonym

for dynamism; the mobility-friendly city will allow for more

freedom and more green spaces as well.

Innovation management really means getting people on board.

Digitisation means groundwork. What’s next?

Johann Jungwirth, Meno Requardt and Phillip Schmitz discuss

the mobility of the future, the Steimker Gärten quarter,

planning limits and new value creation.

REQUARDT > We will have to think of mobility and real

estate as one. Volkswagen Immobilien wants to contribute

to decision-making in the Group through forward-looking

planning. Real estate develops at mobility hubs – where

the effects of digitisation are magnified. More than ever

before, we are engaged in a dialogue with the most varied

of disciplines in the Group.

JUNGWIRTH > In this respect, Steimker Gärten has

become a very special piece of the puzzle. It’s a great

project in collaboration with the city, and within the

framework of #WolfsburgDigital, it can be used as a living

lab for mobility services right at our front door. It allows us

to bring e-mobility closer to citizens. Together with other

projects and town-twinning schemes, Steimker Gärten has

a very important role.

SMART is thinking of real estate and mobility as one

Phillip Schmitz, Head of Technics and Innovation Management

TOPIC

02

The future starts in living labs

such as Steimker Gärten.

JUNGWIRTH > That’s an important point as, although

changes to infrastructure are crucial for electro-mobility,

if we think of future generations of vehicles – of autono-

mous vehicles – then we see it in a whole new light. A

self-driving car such as Sedric will either be on the move

or, for example, at a depot. We won’t need rapid charging

stations at every house and every supermarket.

REQUARDT > The Volkswagen Group will advance

developments throughout Germany and internationally.

It will be interesting to see the technological and also

the social effects.

REQUARDT > A lab – even a living lab like Steimker

Gärten – is not the place where new mobility or smart

homes suddenly lead to some big invention or major

problem-solving. We will create a framework with a

harmonised infrastructure and innovative mobility

services, but it will be the people who develop their

own approaches.

JUNGWIRTH > We anticipate that, when finished,

Steimker Gärten will be 10 or 15 years ahead of its time.

Fifty per cent of households there could choose to have

electric cars – and the infrastructure could cope if this

figure was to rise quickly. In that respect, we’re leaders in

Germany – maybe even in Europe.

SCHMITZ > Yes, one advantage is that more than 90 per

cent of all vehicles in Steimker Gärten will be new vehicles,

so there will be a heavily electrified fleet in the quarter in

no time. It will be a long time before we see that anywhere

else in the world. We will monitor developments and draw

conclusions with respect to organically devel oped cities

and neighbourhoods. We assume that we will be able to

develop a charging infrastructure in existing spaces in the

future at moderate cost, in an economically sensible

manner and with as few construction sites and electrical

installations as possible.

JUNGWIRTH > Kids, the elderly and those with disabilities

will be able to simply press the Volkswagen OneButton and

Sedric will set off, take them to the doctor, the super market

or take grandchildren to see their grand parents, even in

rural areas. Individual mobility for everyone, even people

who have been unable to access it their entire lives. It’s

simply fantastic.

>

Johann Jungwirth, Chief Digital Officer Volkswagen AG

Meno Requardt, Managing Director Volkswagen Immobilien


Excitement about digitisation is growing.

with high-end technology that blends in subtly. Some

measures, for example relating to bicycle-friendliness

and microclimate, are already in place, while solutions are

still being explored for some other measures. The varied

perspectives of all Group disciplines involved were

extremely helpful.

JUNGWIRTH > And it is precisely at this point that we

highly value the cooperation with Volkswagen Immobilien.

We have set a new course of action with IT:City, and

Steimker Gärten – together with the many other inno-

vation topics and projects such as the development of

Nordkopf – is more or less a Wolfsburg 4.0.

JUNGWIRTH > Digital platforms – that can be accessed

through apps or the Volkswagen OneButton, for example –

give customers increasing access to our digital ecosystem

and the Group’s services. This is crucial for value creation

at all levels. Sedric and associated and additional mobility

services will be part of this in the future. We’re trying to

close the gap between public and private transport and

also offer new services. Sedric could serve as a mobile

parcel pick-up station and deliver parcels autonomously.

REQUARDT > Vehicles will remain key. And everything

else will make us even stronger.

SCHMITZ > We are also positioned as a trusted contact

partner when it comes to transformation processes in the

areas of mobility, infrastructure and city planning. We are

curious and want to understand complex interactions and

highlight solutions, with everything at a certain level and

as future-proof as possible. This is precisely what we’re

trying to do with Steimker Gärten. It should simply be a

nice part of the city. Modern, but with no glass palaces;

INNOVATION MANAGEMENT

TOPIC

03

The central place in the Steimker Gärten.

Transformation processes

are teamwork.

JUNGWIRTH > We designed Sedric together with repre-

sentatives of seven potential target groups, we regularly

invite visitors to IT:City and we build trust in everyday

situations in living labs such as Steimker Gärten. I am

confident that happy users will quickly become ambas-

sadors for a new mobility.

SCHMITZ > A mobility with improved safety …

JUNGWIRTH > … Sedric will be ten times safer than

human driving, and conceivably even 100 times safer.

SCHMITZ > I hope to be able to talk about such topics at

length with our customers. There are opportunities here.

REQUARDT > Precisely because we talk about our

core competences: mobility and real estate!

Ultimately we want our customers to be able

to go from A to B as easily as possible. In this

respect, real estate is a kind of mobility hub.

And who should accomplish this, if not

Volkswagen?

No more topics, but a question:

Mr Jungwirth, when will Sedric travel on

the alternative green route between the

plant, the city centre and Steimker Gärten?

JUNGWIRTH > Tests with a safety driver will be carried

out until 2021. We then want to use Sedric in real-life

situations – without a cockpit, without a steering wheel,

without pedals. Then we’ll work on our next goals, as

digitisation is, to me, merely the precursor to what I call

‘Smart Everything’. If we, for example, integrate artificial

intelligence so that Sedric arrives at my house at the right

time without an app and without the OneButton because

the system knows my schedule, then mistakes will still

happen, but we will learn from them quickly and the system

will become cleverer, smarter.

SedricSElf-DRIving Car: The concept for

tomorrow’s mobility combines fully

autonomous driving, electrification

and digital networks.

Volkswagen OneButtonPress the OneButton and Sedric will be

on its way. Coloured signs indicate the

arrival time.

MOIARide hailing and ride pooling:

Request a MOIA e-vehicle using an app

and share it with others.

#WOLFSBURGDIGITALIn 2016, the Group and the city agreed

to make Wolfsburg a model city for

digitisation.

TOPIC

04


PORSCHE CENTRE BERLIN-ADLERSHOF

Visionary new building with an 800 V charging station As one of the most innovative car dealers in Europe,

the Porsche Centre Berlin-Adlershof is setting

new standards with its highly developed charging

infrastructure. A pioneering flagship project that

underscores the company’s e-mobility ambitions.

As contractor, Volkswagen Immobilien planned and

executed the construction work in its third project

for Porsche.

Porsche concept car Mission E

We wanted to plan with a vision and

Volkswagen Immobilien delivered, securing an

adjacent 1,000 m² plot for us on excellent terms.

This will allow us, for example, to expand our

workshop with ease.

HEINZ MOREIRA,

Managing Director at the Porsche Centre Berlin-Adlershof

Directly on the highway A113, close to Berlin Brandenburg

Airport, Porsche’s new showroom opened after only

11 month of construction. The two 800 V charging

stations with RFID authentication for straightforward

e-mobility and cashless payments are the flagship

features of the two-storey property. They were developed

by the Porsche Engineering Group, and are unique the

world over. The property in Berlin-Adlers hof is seamlessly

integrated into a redesigned rapid charging park and is

therefore ideally positioned for the launch of Mission E –

Porsche’s first pure e-sports car, set to hit the road

in 2019.

Key technologies and dynamic architecture

At the Porsche Centre Berlin-Adlershof, customers get

more in less time, with their car batteries being up to

80% charged in the 20 minutes they spend enjoying a nice

coffee. The dealership leads the way when it comes to its

technical facilities and with respect to corporate identity.

In line with Porsche’s sustainability strategy, a particularly

energy-efficient design was chosen and ultra-modern LED

technology was consistently used. Porsche Deutschland

also constructed a 25 m high solar pylon at the site that will

generate up to 30,000 kWh a year.

Porsche everything – a strong brand experience

over 3,000 m²

The showroom is flooded with light and has space for up

to 19 vehicles. It features a fitting lounge, a service de part-

ment with a check-in area and a large workshop with

a storeroom, dry processing and an attached garage for

bodywork. The Adlershof property displays the entire

range of models and the service quality provided reaches

a new level, making the dealership a world of experience, a

central interface and a symbol of highly digitised customer

communication. Everything is in place for the traditional

presales activities – all set for tomorrow’s best seller.


BRAND EXPERIENCE SQUARED

»Hello, auto mile« VW and SEAT share a branch office in Stuttgart When you hear ‘auto mile’, it clicks. Stuttgart-Feuerbach,

Heilbronner Strasse, the biggest brands side by side,

where mobility is within reach. Having a presence there

is a strategic decision and has special appeal. Showrooms

and brand worlds, technologies, design and service can be

compared directly. Those investing in a new dealership

property on the Stuttgart auto mile are entering the

big stage and rightly place the highest demands on their

project developers.

This project had many facets

and was challenging from a

planning and construction

perspective. We had to

compensate for some enor-

mous differences in height on

the property, implemented

photovoltaics, built infra-

structure and charging

stations for e-mobility as well

as 65 nesting grounds for

locally breeding bird species.

JAN ZANDER,

Project Management at

Volkswagen Immobilien

The cubic architecture and roadside construction fulfilled urban development requirements. The showrooms,

the check-in area and the customer zone are all on the ground floor. The first floor features office and social areas,

and the second floor has lounges, sales spaces for used cars and a kitchen for employees. The second floor also

features a parking level with a covered area displaying used cars.

On behalf of Volkswagen Group Retail Deutschland (VGRD),

Volkswagen Immobilien developed and implemented a

joint representative branch office with a car park and

warehouse for the Group brands Volkswagen and SEAT,

which was ceremonially handed over in June 2017. The

project participants Volkswagen Automobile Stuttgart

(VAS) and Seat Stuttgart quickly found common ground,

with construction details subsequently being discussed

and clarified in the planning phase. This efficient process

was supported by advice from VW dealers – creating a

result to be proud of.

Milestone on the auto mile

Two brands, one site, € 24.35 million, 19 months of

construction. The property features an impressive, round,

150 m long wing with a glass-and-slat facade and

15,000 m² of usable space. The use of space has been

planned innovatively over five floors, divided into three

full storeys and two underground floors. The cubic

architecture structurally establishes a relationship between

Volkswagen and SEAT, yet the presentation of the two

brands is distinct and designed in accordance with their

respective CI specifications. The very open-plan layouts

offer all conceivable opportunities and can be quickly and

flexibly reconfigured for sales campaigns.

Urban customer magnet

he parking level for showing used cars is a particular

highlight. It extends across the entire building and offers

space for 200 vehicles of both brands. Initial reviews

of the joint branch office confirm its attractiveness.

Twenty-three per cent of all visitors are new customers.

Accordingly, Volkswagen aims to undertake around

850 marketing activities in 2018 – twice as many as

at the since-closed Weilimdorf site. The target level for

used cars is around 1,200 vehicles.

Our new site is symbolic of

the SEAT brand’s impres-

sive development in

Germany. It’s not just the

building’s modern archi-

tecture and the attractive

design of the showroom

that convey the brand’s

values, but also the

prestigious location on

Stuttgart’s auto mile.

ERIK HÄNDLER,

Managing Director of the

SEAT Deutschland dealerships

The ideal property was

finally found in 2013 after

a long search. It was just

too big for VW cars. We

then saw an opportunity

in cooperation with Seat

Stuttgart to achieve

synergies on the auto mile.

Today, we jointly use

building services, vehicle

preparation facilities,

washing facilities, the

parking level and heating

system. This saves money:

we were well advised.

MICHAEL PERNER,

Managing Director at

Volkswagen Automobile Stuttgart


VWI REAL ESTATE FINANCE

Green financial products: pursuing SMART new paths with sustainable investorsVolkswagen Immobilien leverages opportunities in the real estate

finance segment and therefore generates positive value for the Group.

The finance strategy was revised in 2017 and the financing mix expanded,

with one focal point being the development of green financing instru-

ments. Volkswagen Immobilien will issue green bonds for the first time

in 2018, namely registered bonds to finance real estate constructed to the

BLUE BUILDING standard.

Volkswagen Immobilien also plays a role via Volkswagen

Group Treasury in the Group’s internal financing, with

all the associated advantages with regard to, for example,

short-term capital requirements, such as in the interim

financing of construction projects. Broadening the

financing mix to include promotional loans, mortgage

loans, promissory note loans and registered bonds will

free up the Group’s credit line. For example, active cash

management to the tune of € 200 million in 2017 reduced

the interest burden by € 8.5 million over the term.

Sustainable planning, construction

and financing at Volkswagen Immobilien

Volkswagen Immobilien has long observed the BLUE

BUILDING standard. New construction projects are

carried out sustainably and therefore help to reduce

CO2 emissions and energy costs. VWI’s Real Estate

Financing division pursued this approach holistically

and believes that sustainable plans should be sustainably

financed – potentially also including the innovative

green bonds.

DR. FABIAN LANDER, Head of Corporate Finance and Sustainability

We will focus on green financial products when making sustainable invest-ments in the future. This focus will provide for access to other new groups of investors; we thus generate an advantage for the Volkswagen Group.

An important milestone was achieved in December 2017

as Volkswagen Immobilien was awarded a PRIME rating

by oekom research AG for its extensive sustainability

work along the entire value chain. A leading global rating

agency for the sustainable investment segment thus

qualifies Volkswagen Immobilien to participate in a

growing market. Investors are increasingly undertaking

to invest in green financial products and will have an

additional option from 2018 in the form of Volkswagen

Immobilien’s green bonds. New groups of investors are

opening up and increasing the Group’s competitiveness

in the long term.


STEIMKER GÄRTEN: CONSTRUCTION BEGINS

Making a vision reality

Urban, green, innovative – short distances, social infrastructure, new thinking!

Steimker Gärten will be a unique quarter. Volkswagen Immobilien is developing

a 22 ha. site which will be home to some 1,250 new residential units.

VWI is constructing 260 rental apartments there for its own portfolio.

External investors are developing a further 1,000 residential units.

Volkswagen Immobilien will be responsible for marketing some of these.

Steimker Gärten is an attractive addition to the landscape.

Various types of construction are planned for the site,

ranging from family homes to multistorey apartment blocks.

There will be shopping facilities and a retirement home with

an integrated day-care centre. The new quarter will be a

living lab where electro-mobility will be experienced in a

wide range of areas much earlier than anywhere else.

At home with the future

Mobility solutions and real estate concepts blend together

in Steimker Gärten, where #WolfsburgDigital is manifest and

the intelligent combination of private and public transport is

a defining feature. Residents will share experiences relating

to the smart home, new forms of mobility and associated

Construction phase 1: All plots have been assigned and construction began in September 2017.

The first rental and owner-occupied apartments are scheduled for completion in 2020. The site is being developed in accordance with the BLUE BUILDING standard for energy and socio-economic quality.

services. An example of this is Sedric –

Volkswagen’s SElf-DRIving Car combines

fully autonomous driving, electrification and digital net-

works. Sedrics could in future use the alternative green

route between Steimker Gärten, the city centre and the

Volkswagen plant. Mobility for all ages – with flexible

app-based booking.

High demand – great commitment

Volkswagen Immobilien is heavily involved in the residential

construction offensive Wolfsburg 2020. Steimker Gärten is

an important milestone and a model project in terms of

city planning, architecture and consistent building quality.

The site requires sustainable and holistic thinking in new

Our investors believe

in Volkswagen’s strengths

and innovation. ULRICH SÖRGEL, Head of Residential Real Estate, Marketing and Communication

#WolfsburgDigital initiative

#WolfsburgDigital is a joint initiative of

the Volkswagen Group and the city of

Wolfsburg. The aim is to create an exam-

ple of best practice for digitisation and

electro-mobility – a city where the future

can be experienced. Steimker Gärten is

an important building block and one of

Germany’s largest housing projects. More

than 2,500 people will find a home here

and experience the Volkswagen Group’s

innovations in their everyday lives.

dimensions: Volkswagen Immobilien will market rental

and owner-occupied apartments on behalf of some

investors, has already built up a pool of prospective buyers

and tenants, and contributes more than 60 years of local

market knowledge. This makes construction projects in

Steimker Gärten even more attractive for investors outside

the region.


MARKETING FOR THE FIRST CONSTRUCTION PHASE RETIREMENT HOME AND DAY-

CARE CENTRE

Specht Group

65 owner-occupied

apartments,

moretti

wohn- und

bauprojekte GmbH

STEIMKER DUETT 38 owner-occupied

apartments, Meyer Projek-

tentwicklung GmbH

STEIMKER QUARTETT

73 owner-occupied

apartments, Meyer Projek-

tentwicklung GmbH

31 rental apartments,


Steimker Gärten

Steimker Gärten on film

DREIGÄRTEN

300 rental

apartments,

Justus Grosse GmbH34 owner-occupied

apartments,

Buhlmann

Immobilien GmbH

25 housing units:

family and terraced

houses, owner-occu-

pied apartments

29 terraced and

semi-detached

houses

9 town

and terraced

houses







Gifhorn

Wolfsburg

Braunschweig


OUR OFFERING AT A GLANCE

More homesWe are one of the most important providers of housing in Wolfsburg.

Our core responsibility is to provide attractive residential offers for

employees of the Volkswagen Group. Whether people need somewhere

for a few days, months or for many years – Volkswagen Immobilien has

over 9,000 homes on its books and plenty of ideas for more housing.

Short-term

Medium-term

Long-term

Number of units available

Coming soon

Hotel

Global Inn

241 rooms

Communal living

and accommodation

for commuters

Over 500 furnished

rooms

Furnished

accommodation

150 fully furnished

two- to five-room

apartments

SPLACE

business apartments

60 high-quality,

furnished one-room

apartments available for

rent from summer 2019,

with many services

Rental apartments

Around 9,200 portfolio

apartments

For business travellers,

for instance. Between

€ 56 and € 126 per night

For trainees and

commuters,

for instance. Between

€ 245 and € 430 per month*

For managers and

project staff, for instance.

From € 750*

For workers staying in Wolfsburg

temporarily, for instance. Between

€ 600 and 1,900 per month*

Gifhorn

Wolfsburg

Braunschweig

New apartments

An additional 370 new

rental apartments

by 2019

For all workers.

€ 6.25 per m2

net basic rent per month

(on average)

Estate agency

Brokerage of third-party

residential properties

in the VW region Wolfsburg,

Braunschweig and Gifhorn

Residential property

Around 10,000 own units

in Wolfsburg!

* Including utilities and

service charges

Graphics: Infographics Group


HOME COMFORT 3.0

The qualities of a modern city hotel, all the benefits of a private apartment

and extra comfort when work is finished. This is SPLACE. The new brand

for short-term stylish living – a new product from Volkswagen Immobilien.

Sixty business apartments will be constructed by 2019 at Wellekamp 22 in

central Wolfsburg, directly opposite the Volkswagen plant.

Ground was broken in October 2017, marking the official

start of construction. SPLACE is part of an ensemble of

five buildings, with fifty-six rental apartments being

constructed in its immediate vicinity. The site is within

a park complex with shopping facilities and restaurants

close by. The city centre, main train station and the

Volkswagen Group’s headquarters can be reached on foot

in minutes, while Braunschweig Airport is 28 km away.

At home with hotel services

SPLACE business apartments combine the privacy and

comfort of a rented apartment with the extensive comfort

of a hotel. The apartments cover between 26 and 46 m²

and will be available in three categories: Classic, Comfort

and Superior. All apartments are lovingly detailed with

stylish furniture and offer high-quality fittings, with

high-speed Internet, a balcony, underfloor heating,

modern bathrooms and a kitchenette with a dishwasher

and coffee maker.

Rental periods lasting from several weeks to many months

are easy to organise with SPLACE. The key is tailored

services ranging from laundry services and apartment

cleaning to breakfast and concierge services, as well as car

and bike sharing for flexible mobility. Every apartment has

a parking space and there are also charging stations for

electric vehicles. The building’s gym with cardio equip-

ment and free weights is available exclusively to SPLACE

tenants. Additional highlights include the SPLACE lounge

for residents and the SPLACE rooftop for relaxing evenings

or a spontaneous barbecue above the city roofs.

SPLACE business apartments: Breaking ground as construction begins

SPLACE combines lifestyle, ambience

and functionality. Smart home technologies

are also used, including intelligent app-based

light and temperature control and a keyless

locking system.

The ability to offer the entire spectrum of housing services is key

to the attrac tiveness of our city. SPLACE is a highly significant element

of the Homes & Con struction 2020 municipal master plan. The efficient

development of the available space at Wellekamp sets an example.

KLAUS MOHRS, Mayor of the city of Wolfsburg


HOTEL MODERNISATION WORK COMPLETED

Thought outside the box, asked guests, made plans. Plan three construction

phases, modernise and invest – successfully. The Global Inn has become

more attractive, is more open and adaptable, and offers more comfort and

a greater quality of stay.

It’s all about the guest in the hotel industry. But guests

are not all the same. Business travellers have different

priorities from visitors to the Autostadt complex and

phaeno. Extensive guest surveys provided an insight into

guests’ priorities. From comfort and services to quality

of stay, Volkswagen Immobilien analysed guests’ wishes

and criticism.

The rooms and halls were upgraded as part of the

modernisation, and public areas and restaurants were

restructured. The result is a multifunctional lobby with

a reception area, and a new generous bar with fully

redesigned dining options.

Open, modern lobby

Outside the urban glass extension catches the eye, the

generous window facade with a terrace in front draws

A new look for the Global Inn

Global Inn at a glance

The Global Inn is close to the plant and

centrally located in Wolfsburg, ideal for

business travellers or family trips. Operated

by Volkswagen Immobilien.

— 241 rooms

— 15 studios with kitchenette

— Breakfast and evening buffets,

alternating daily specials

— Snack shop, free newspapers, fast Wi-Fi

— Fitnessarea

— 120 parking spaces on-site

— Charging stations for electric vehicles

www.globalinn.de

guests in and a wide staircase with an integrated ramp

leads to the main entrance. The lobby boasts smooth

transitions and lots of light, with inviting seating to the left.

A long white counter forming the elegant reception area

is located centrally and is impossible to ignore.

A particular highlight at the Global Inn is the alternating

vehicles shown in the lobby in cooperation with the

Wolfsburg Automuseum – starting with a historic Beetle

from 1955. A show wall also displays numerous Volkswagen

Our aim was to create a friendly, inviting atmosphere and

provide a greater quality of stay for our guests, even in

the evening. We’ve managed to do that with the new bar

and lobby area and extended dining options.

MELANIE RUNKEHL-KÖSE, Manager of the Global Inn

model cars that can be purchased in the shop – perfect

for those looking for a small souvenir.

A welcoming atmosphere even in the evening

The Global Inn is a three-star establishment with sophisti-

cated details and high-quality workmanship. A cosy

fireplace area and the redesigned bar are just a few steps

away from the reception. There is also a multifunctional

lounge where breakfast is served in the morning and

comfortable seating invites guests to relax in the evening –

be it for larger groups or an informal chat after a long

workday. Another new addition is a distinctive community

table for up to 20 people that can be used flexibly for

private functions or for internal events.


AN INTERVIEW WITH HR MANAGER SVEN SCHURWANZ

Flexible work is SMART

Mr Schurwanz, employees at

Volkswagen Immobilien have been

working more flexible and also more

self-determined hours since the

beginning of 2017 in the scope of

trust-based working hours. Is the

time clock no longer in use?

> We’ve stopped using the time clock

and haven’t recorded any working

hours for a year. We give our employ-

ees the freedom to organise their

working hours independently and

flexibly. Family life and work can now

be reconciled even more effectively.

The benefits of trust-based working

hours are obvious: employees can spend more time work-

ing Monday to Thursday so they can then leave earlier,

spend time with their children or run errands for their par-

ents on Friday. We have organised it such that it meets the

needs of the employees and the employer. The key factor

was that we expanded flexible working hours and made

company and team agreements on mobile work at the

same time. We also agreed on service hours when employ-

ees should be reachable.

With trust-based working hours with no time recording,

generous flexible working hours between 6:30 and 20:00 and

mobile work for maximum flexibility and self-determination,

Volkswagen Immobilien uses a modern working time model,

trusts its employees and gets a lot back in return.

It’s interesting how

positively applicants

respond to the triad of

trust-based working

hours, flexible work ing

hours and mobile

work. At Volkswagen

Immobilien, there are

often new opportu -

nities to combine work

and private life in

combination with a

35-hour contract.

Has it changed how you work

together? What are the sticking

points?

> You can’t impose a move from a cul-

ture of presence to a culture of execu-

tion. Over the years one thing leads to

another. An example of this would be

mobile work. Volkswagen Immobilien

ran a pilot project for this as early as

2015. It only works if you have the right

corporate culture, if trust and commu-

nication are firmly established. It might

sound paradoxical, but this closeness,

this feeling of togetherness, makes it

easy to let go – and naturally we’re still

working together to find a balance between freedom and

planning security. What matters is the result and that agree-

ments are kept. With flexible

and mobile work, this also in-

cludes respecting colleagues’

clocking-off time. We’re making

good progress here and the

feedback from departments is

very positive.

Sven Schurwanz,

Head of Human Ressources & Legal

There’s more freedom of action than ever before.

What role does self-determination play

in the development of creativity, innovation

and entrepreneurial thinking?

> Self-determination is a key prerequisite for motivation.

Motivated people pursue issues with conviction and don’t

miss a thing. That’s how you grow as a person, and it’s the

same with the company. Employees then have the right

attitude towards their employer, in addition to being happy

with their remuneration and social benefits. Turnover falls

and productivity increases. It’s important to establish a rela-

tionship between self-determination and teamwork, to try

things out but also to be organised. In this respect, agile

work processes will in future help us to make the right de-

cisions more quickly. For starters! We’d like to go further;

we want to be encouraging and grow when it comes to

dealing with mistakes. What went well, what didn’t, what do

we need to improve? New review processes and feedback

training for managers are all part of the package.

Becoming faster, making more things possible –

those were the main reasons behind the restructuring

of corporate real estate management. How has the

unit changed?

> On the one hand, the consolidation period gave us the

opportunity to look at our internal processes more deeply

than before. On the other hand, we received many new

tasks from our customers during this period. So we im-

proved coordination channels and significantly streamlined

many processes in terms of project initiation, appraisal and

execution. As a learning organisation, we see how new

structures translate into reality and where we may need to

make changes. We deal with uncertainties proactively and

seek dialogue across the board. We want to keep everyone

on board, are looking to grow and will continue to achieve

a lot together.

André Reuter, employee in the organizational development, is one of 162 employees,

who works regulary in mobile work.


FACTS AND FIGURES

2017

2016

2015

398,431

365,611

358,269

604,613

613,281

608,986

in m2

Residential Commercial

Residential and commercial property portfolio

The commercial and residential real estate projects

executed in the past contribute to the positive

path of development and ensure the success of

Volkswagen Immobilien in the long term.

2017 –The year of consolidation


Course of business

Commercial property

Corporate real estate management (CREM) supports the

Volkswagen Group with a number of real estate issues.

Services offered by Volkswagen Immobilien include

the development, execution and operation of real estate

projects and consulting relating to real estate. The

company’s global customers include almost all of the

Volkswagen Group’s brands – predominantly Volkswagen

Pkw and Volkswagen Nutzfahrzeuge. The capital

expen ditures of € 11.9 million mainly include capital

expenditures for IT:City and renovation work on existing

buildings. There was also a major project with hall space

of 12 ha on a property covering 30 ha for the logistics

optimisation centre in Bratislava, Slovakia, which our sub-

sidiary – Volkswagen Group Real Estate Slovakia s.r.o. –

Managed commercial space

2017 2016 Change (%)

Proprietary commercial space (m²) 398,431 365,611 + 9.0

Lease contract and lease management, number of managed lease contracts 237 243 –2.5

Lease contract and lease management, managed rental space (m²) 1,700,000 1,635,000 + 4.0

Property management, managed space (m², rounded up to nearest 1,000) 411,000 375,000 + 9.6

Facility management, managed space (m², rounded up to nearest 1,000) 873,000 783,000 + 11.5

Investments in commercial property (€ k) 11,873 45,518 –73.9

handed over to the user Volkswagen Slovakia a.s. at the

end of 2017. The project is not included in Volkswagen

Immobilien’s capital expenditures.

The restaurant and reception area at our hotel Global Inn

were restructured in 2017. Since the end of 2017, the hotel

has had a new, modern, customer-friendly lobby. The

average room occupancy at the hotel was 61% and

there fore slightly below the previous year’s value (62%),

in accordance with the trend in the Wolfsburg hotel

market. As a result, the hotel’s revenue fell slightly in the

financial year. Bed occupancy was 35.3% and therefore

was once again higher than the average occupancy at all

Wolfsburg hotels.

FACTS AND FIGURES

Nordring in Fallersleben and the energy modernisation of

individual buildings in Wolfsburg. The replacement of lifts

in our portfolio properties was also continued in 2017.

The estate agency service offered a total of 46 apartments

and houses for rent and sale in financial year 2017 (previ-

ous year: 60). Intense negotiations about the marketing of

owner-occupied apartments in the Steimker Gärten

project resulted in sales agreements with other investors,

which are expected to lead to an increase in estate agency

business from 2018.

Total occupancy rate

(%)

2017

2016

2015

2014

2013

98.0

97.3

98.1

97.6

98.3

Residential property

Average rental progression per year

in €/m2

0.00 1.00 2.00 3.00 4.00 5.00 6.00 7.00 8.00 9.00

Net basic rents

Net basic rents for new lets

Costs = Operating costs

2017

2016

2015

2014

2013

6.34

6.06

5.99

5.82 Costs 1.42

Costs 1.42

Costs 1.42

Costs 1.42

6.31 Costs 1.42

6.98 Costs 1.42

7.13 Costs 1.42

7.51 Costs 1.42

6.26 Costs 1.427.12 Costs 1.42

Demand far outstrips supply on the Wolfsburg housing

market. This is clear given the vacancy rate for lettable

housing, which was only 0.7% at the end of the year. This

stands in contrast to a list of more than 1,600 potential

tenants. The letting rate at the end of 2017 was 98.0%

–0.7% higher than at the end of the previous year. Apart-

ments that were closed in 2016 as a result of portfolio

measures – especially in Nordring in Fallersleben – were

completed and are now available for rent again. Sixty-eight

new apartments were completed in 2017 under the new

residential construction programme and handed over to

apartment seekers. Net rents rose as a result of the newly

created living space in the high-end segment and as a

result of the reletting of existing apartments at market

rates following modernisation. The number of apartments

held by the company rose to 9,175 in 2017 (previous year:

9,131) as more apartments were completed in 2017 than

were sold as part of the portfolio measures.

Capital expenditure under the new residential construction

programme reached a high of € 10.9 million in financial

year 2017 (previous year: € 19.7 million). These capital

expenditures allowed apartments to be completed and

were also used to lay the groundwork for our future

projects. Fifty-six apartments and 60 business apartments

are being constructed in the Wellekamp project, for which

excavation work began in 2017. The aim is to offer these

apartments to new tenants in 2019. Some capital expendi-

tures planned for 2017 had to be postponed until 2018 as

the construction boom meant that some companies were

not available. The main focus in the financial year was the

development of the new quarter Steimker Gärten. A high

level of interest from investors demonstrates how our

work continues to be successful, with numerous plots

being sold to renowned, sustainable investors in 2017.

Additional plots will be marketed in the coming financial

year. Construction work for the first apartments built by

Volkswagen Immobilien began in 2017 and is scheduled

for completion in 2019.

Maintenance, renovation and modernisation costs rose in

financial year 2017 by 4.8% to € 20.44 million. Volkswagen

Immobilien therefore plays its part in increas ing the quality

of housing in Wolfsburg, as 65% of our existing properties

have now been modernised. The majority of costs were

attributable to renovation work on existing properties in


Net assets, financial position and results of operationsThe results of operations, financial position and net assets

of Volkswagen Immobilien GmbH should be interpreted in

the context of the company’s inclusion in the Volkswagen

Group. The figures indicated in the tables and texts have

been calculated in accordance with the International

Financial Reporting Standards (IFRS).

Sound earnings

Volkswagen Immobilien achieved a higher profit before tax

in financial year 2017 than in the previous year, generating

€ 35.6 million, corresponding to a 17.6% increase.

Revenue in the amount of € 156.3 million was almost at

the previous year’s level (€ 158.1 million). Here, rental

income from commercial properties rose as a result of real

estate projects that had been completed in the past, such

as IT:City. The decline in real estate services is due in

par ticular to general contracting business (Open Hybrid

Lab Factory) that was settled in 2016. There was no

correspond ing general contracting business in 2017,

though revenue from the sale of developed plots to

external investors in the Steimker Gärten project had an

offsetting effect. Revenue from project development,

project management and lease management was slightly

higher than in the previous year. Revenue for residential

and other real estate rose on the previous year, due to the

residential properties completed in 2016/17.

The cost of sales decreased disproportionately compared

to revenue, as a result of which the earnings contribution

of € 77.5 million was € 6.7 million higher than in the pre vi ous

year. This was achieved in particular as a result of the

measures implemented in the past to improve the cost

structure and the one-off effect from the sale of devel oped

properties in the Steimker Gärten project. Personnel costs

increased by 6.7% to € 30.9 million, mainly due to the

increase in personnel at the end of 2016 and in financial

year 2017 as well as pay increases.

Volkswagen Immobilien achieved an operating profit of

€ 41.4 million in financial year 2017 (previous year: € 35.5 mil-

lion), continuing the positive trend seen in previous years.

The financial result fell year-on-year by € 0.6 million to

€ –5.8 million, mainly due to higher interest expenses.

At € 24.3 million, profit after tax increased € 3 million on the

previous year. In accordance with the control and profit

transfer agreement, the earnings of € 28.3 million derived

from the financial statements prepared according to

local GAAP were distributed to Volkswagen AG in the first

quarter of 2018.

Residential and other property Real estate services Commercial property

2013

Sales

€ 126,078,000

2014

Sales

€ 138,592,000

2015 2016

Sales

€ 184,371,000

Sales

€ 156,288,000

63,784

18,269

44,025

63,013

23,772

51,808

63,107 63,053

64,04438,843

57,220

56,251

Sales development by business unit

€ k

FACTS AND FIGURES

2017

Sales

€ 158,147,000

64,622

30,128

61,538

01.01. – 31.12.2017

€ k

01.01. – 31.12.2016

€ k

Sales

from facility management 121,351 113,791

from property management 12,821 12,317

from other products and services 22,116 32,039

156,288 158,147

Cost of sales –78,787 –87,356

Contribution to operating income 77,501 70,791

Staff and indirect material costs –40,270 –39,226

Other operating income 5,727 6,148

Other operating expenses –1,566 –2,211

Operating profit 41,391 35,501

Finance expenses –5,290 –4,623

Other financial result –535 –627

Financial result –5,826 –5,251

Results of ordinary business activity 35,565 30,250

Income taxes and deferred taxes –11,223 –8,920

Profit for the year, after tax 24,343 21,331

Income statement


At € 31.6 million, the net cash flow improved € 55.7 million

on the previous year.

As regards financing activity, the cash outflow was

€ 25.3 million (previous year: cash inflow of € 16.8 million).

The cash outflow in 2017 results from the dividend

payment in the amount of € 25.9 million (previous year:

€ 23.1 million). The other financial liabilities remained at

the previous year’s level in 2017. They increased by

€ 40.0 million in the previous year compared to 2015.

Net liquidity was, at € –287.4 million on 31 December 2017,

slightly above the previous year’s level (€ –293.0 million).

2017

2016

2015

2014

2013

39

36

37

36

39

Schedule of changes in the equity ratio

(%)

Solid financial position

FACTS AND FIGURES

Volkswagen Immobilien’s gross cash flow rose by

€ 8.5 million to € 53.8 million in financial year 2017. The

higher profit before tax (€ +5.3 million) and the higher

depreciation and amortisation (€ +3.7 million) made a

positive contribution to this in particular. The change in

working capital fell by € 2.3 million to € –2.8 million. The

cash flow from ongoing business rose overall by 26.6% to

€ 51.1 million.

Capital spending declined in financial year 2017 to

€ 19.5 million (previous year: € 64.4 million). Investments in

investment projects that Volkswagen Immobilien carried

out in the commercial segment for the Volkswagen Group

decreased, as did capital expen diture as part of the new

residential construction programme. A large investment

project in a logistics hall in Slovakia is being implemented

by our subsidiary in Slovakia and is therefore not included

in Volkswagen Immobilien’s financial statements.

Statement of cash flows

2017

€ k

2016

€ k

Cash and cash equivalents, opening balance 6,782 14,050

Profit before tax 35,565 30,250

Income tax payments –8,967 –7,312

Depreciation and write-ups, netted 28,330 24,668

Changes in pension provisions 175 –10

Cash flow from the disposal of assets –1,257 –2,208

Gross cash flow 53,846 45,388

Change in working capital –2,771 –5,058

Cash flow from ongoing business 51,075 40,330

Investments in property, plant and equipment –27,742 –68,389

Change in investments 0 –4

Disposals of assets 8,261 3,953

Investments –19,481 –64,440

Net cash flow 31,594 –24,110

Changes in loans –66 0

Investments incl. financial investments in securities and loans –19,546 –64,440

Dividend payment / loss equalisation –25,883 –23,111

Change in other financial liabilities 609 39,953

Financing activities –25,274 16,842

Change in cash and cash equivalents 6,254 –7,268

Cash and cash equivalents, closing balance 13,036 6,782

Gross liquidity 13,036 6,782

Borrowings –300,410 –299,801

Net liquidity –287,374 –293,019


At € 653.4 million, Volkswagen Immobilien’s total assets

at 31 December 2017 were slightly higher than in the

previous year (€ 647.7 million).

Non-current assets fell by 1.7% to € 612.1 million as

depreciation and amortisation exceeded the investments

made in 2017. The decline in property, plant and equip-

ment is largely due to the reclassification of the assets

pertaining to our hotel Global Inn as investment proper-

ties. Investments in property, plant and equipment at

Volkswagen Immobilien in 2017 predominantly focused on

follow-up activities in the IT:City project. The increase in

investment properties is due to the aforementioned effect

from the recognition of our hotel and the continuation of

our new residential construction programme. The latter

saw the completion of apartments in the financial year

as well as the execution of infrastructure and excavation

works for the new Steimker Gärten quarter and in the

Wellekamp and Nordring Fallersleben projects.

Current assets of € 41.3 million were up € 16.3 million on

the previous year, largely due to the increase in inven-

tories. Volkswagen Immobilien is developing the new

Steimker Gärten quarter. The properties sold to investors

are being developed by Volkswagen Immobilien. These

properties and the development measures are included

in the inventories. Cash and cash equivalents almost

doubled to € 13.0 million.

Equity amounted to € 233.3 million at the end of the

financial year (previous year: € 236.6 million), where the

higher profit transfer than in the previous year had the

effect of reducing equity. The equity ratio fell from 37%

to 36% but remains high.

Volkswagen Immobilien improved its financing structure in

financial year 2017. Non-current assets are now almost

entirely covered by equity and non-current liabilities. In this

context, a secured loan in the amount of € 155 million was

taken up, resulting in a 68.9% increase in non-current

liabilities to € 325.2 million. Current liabilities fell 56.6% to

€ 94.9 million at the same time.

Non-current assets Equity Current assets Non-current liabilities Current liabilities

Financial structure

€ k

Assets

2017

Equity and liabilities

653,381

2016

236,597

218,581

192,502

647,680

2017

653,381

2016

622.669

25,011 41,269

647,680

Solid asset position

2017

2016

2015

2014

2013

622,967

653,381

647,680

573,790

453,921

Schedule of changes in net assets

€ k

FACTS AND FIGURES

612.112

233,255

325,190

94,936

As at 31.12.2017

€ k

As at 31.12.2016

€ k

Assets

Non-current assets

Intangible assets 375 545

Property, plant and equipment 414,384 437,915

Investment property 173,158 157,049

Interests in other companies 9 9

Other receivables and other assets 55 76

Deferred income tax claims 24,131 27,075

612,112 622,669

Current assets

Inventories 10,400 2,117

Trade receivables 7,760 4,910

Other receivables and other assets 9,944 11,120

Income tax receivables 129 82

Cash and cash equivalents 13,036 6,782

41,269 25,011

Total 653,381 647,680

Equity and liabilities

Equity

Subscribed capital 14,322 14,322

Capital reserves 90,689 90,689

Retained earnings 128,244 131,586

233,255 236,597

Non-current liabilities

Financial liabilities 278,890 143,057

Other liabilities 9,330 8,602

Deferred income tax liabilities 7,669 11,262

Pension provisions 26,218 26,689

Other provisions 3,083 2,892

325,190 192,502

Current liabilities

Financial liabilities 21,521 156,745

Trade payables 9,486 7,093

Income tax liabilities 11,919 8,920

Other liabilities 42,292 41,807

Other provisions 9,718 4,016

94,936 218,581

Total 653,381 647,680

Statement of financial position as at 31 December 2017

> ANNUAL REPORT 201742

OutlookFor financial year 2018, Volkswagen Immobilien plans to

generate a profit before tax on a par with 2017. Following

a year of consolidation, we expect that the number of

investments made will rise significantly compared to

financial year 2017.

We will continue to pursue growth for Volkswagen

Immobilien. Our aim is to work on a number of national

and, increasingly, international real estate projects within

the Volkswagen Group and to support the Volkswagen

strategy Together 2025+.

The residential real estate segment will see construction

measures, the development of the second construction

section and the marketing of additional plots in the

Steimker Gärten project. We will also focus on continually

adding value to our existing residential properties in order

to increase customer satisfaction.

We will continue to consistently pursue our aim of

exe cuting the most varied of real estate projects

efficiently, transparently and above all economically for

the customer.

FACTS AND FIGURES


Number of own apartments 9,175 9,131 +�0.5

Residential space (m2) 613,281 608,986 +�0.7

Number of commercial properties 194 186 +�4.3

Commercial space (m2) 398,431 365,611 +�9.0

Employees incl. trainees, annual average 354 340 +�4.1

Employees incl. trainees at year end 357 353 +�1.1


Revenue 156.29 158.15 –�1.2

Operating profi t 41.39 35.50 +�16.6

Profi t before tax (IFRS) 35.57 30.25 +�17.6

Profi t after tax (IFRS) 24.34 21.33 +�14.1

Fixed assets 587.92 595.51 –�1.3

Investments 27.74 68.40 –�59.4

Total assets 653.38 647.68 +�0.9

Cash fl ow from ongoing business 51.08 40.33 +�26.6

Gross cash fl ow 53.85 45.39 +�18.6

Key fi gures (%)

Return on sales before tax 22.8 19.1 +�19.0

Equity ratio 35.7 36.5 –�2.2

ROI 4.9 4.2 +16.7


of key fi gures






looked after��*

98%



subsidiaries

1.7 million m2

employees sometimes

undertake mobile work��**

3 out of 4






looked after��*

98%



subsidiaries

1.7 million m2

employees sometimes


3 out of 4

IMPRINT

Published by

Volkswagen Immobilien GmbH

Poststrasse 28

38440 Wolfsburg, Germany

Design and layout

wirDesign Berlin Braunschweig

www.wirDesign.de

Text

André Moch

www.andremoch.de

Photos

Janina Snatzke Fotografi e

Marek Kruszewski

Matthias Leitzke

Sven Otte Fotografi e


Printed by

Gutenberg Beuys Feindruckerei GmbH

www.feindruckerei.de

This annual report is printed on

Druckfein

In order to ensure better readability

of the texts we refrained

from using the female gender.

Naturally, women are equally addressed.

We ask for your understanding.

As at | March 2018

U2 = 211 mm 5,0 Klebefläche U3 = 211 mmEinklapper U2 = 165 mm

RZ_VWI17040_Jahresbericht2017_PSO_U_EN_Umschlag.indd 5-8 05.03.18 14:12


Number of own apartments 9,175 9,131 +�0.5

Residential space (m2) 613,281 608,986 +�0.7

Number of commercial properties 194 186 +�4.3

Commercial space (m2) 398,431 365,611 +�9.0

Employees incl. trainees, annual average 354 340 +�4.1

Employees incl. trainees at year end 357 353 +�1.1


Revenue 156.29 158.15 –�1.2

Operating profi t 41.39 35.50 +�16.6

Profi t before tax (IFRS) 35.57 30.25 +�17.6

Profi t after tax (IFRS) 24.34 21.33 +�14.1

Fixed assets 587.92 595.51 –�1.3

Investments 27.74 68.40 –�59.4

Total assets 653.38 647.68 +�0.9

Cash fl ow from ongoing business 51.08 40.33 +�26.6

Gross cash fl ow 53.85 45.39 +�18.6

Key fi gures (%)

Return on sales before tax 22.8 19.1 +�19.0

Equity ratio 35.7 36.5 –�2.2

ROI 4.9 4.2 +16.7


of key fi gures






looked after��*

98%



subsidiaries

1.7 million m2

employees sometimes


3 out of 4






looked after��*

98%



subsidiaries

1.7 million m2

employees sometimes


3 out of 4

IMPRINT

Published by

Volkswagen Immobilien GmbH

Poststrasse 28

38440 Wolfsburg, Germany

Design and layout

wirDesign Berlin Braunschweig

www.wirDesign.de

Text

André Moch

www.andremoch.de

Photos

Janina Snatzke Fotografi e

Marek Kruszewski

Matthias Leitzke

Sven Otte Fotografi e


Printed by

Gutenberg Beuys Feindruckerei GmbH

www.feindruckerei.de

This annual report is printed on

Druckfein

In order to ensure better readability

of the texts we refrained

from using the female gender.

Naturally, women are equally addressed.

We ask for your understanding.

As at | March 2018

U2 = 211 mm 5,0 Klebefläche U3 = 211 mmEinklapper U2 = 165 mm

RZ_VWI17040_Jahresbericht2017_PSO_U_EN_Umschlag.indd 5-8 05.03.18 14:12

www.vwimmobilien.de

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