Heat stress is developing into a structural location and building risk for the real estate industry. A Germany-wide analysis by Wüest Partner shows that increasing heat stress is increasingly influencing the quality of the location, usability and the requirements for real estate. Densely populated areas in southwestern Germany are particularly affected.
“Climate risks should be considered at an early stage in location, ESG and investment decisions,” says Sophie Nieder, Senior Economic Market Analyst at Wüest Partner. “It is becoming increasingly crucial for investors, owners and municipalities to understand the climatic quality of a site at an early stage and to take the right measures where necessary.”
Southwest Germany particularly burdened
The study shows clear regional differences. Particularly high pollution levels are found in densely populated urban areas such as the Rhine-Ruhr area, the metropolitan regions of Berlin, Hamburg, Munich and Stuttgart, and especially in the Rhine-Neckar and Upper Rhine regions. There, the combination of high basic climatic pollution, dense development and heavy sealing leads to the highest heat stress values in Germany.
In contrast, coastal regions, wooded areas and municipalities with pronounced green and water areas have significantly lower pollution. Above all, the climatic balancing effect of large bodies of water and better air circulation have a relieving effect here.
Microlayer determines heat stress
The study also shows that heat stress should not be considered solely at the level of entire cities. Even between immediately adjacent neighborhoods, considerable differences can occur.
The example of Hamburg shows that the Ottensen district has a significantly higher heat stress index than neighboring Othmarschen. The main decisive factors are differences in building density, sealing, green spaces and open space structures.
“Our results make it clear that the micro-location will determine the climatic quality of a site even more strongly in the future. Green spaces, open spaces and waterfront locations are increasingly becoming relevant factors for real estate and neighborhoods,” explains Lucas Bensch, Senior Data Scientist at Wüest Partner.
The comparison of entire cities also illustrates the importance of climatically effective open space and water structures. While Hamburg has an average heat stress value of 0.44, Ludwigshafen am Rhein, as part of the Upper Rhine region, reaches a value of 0.65 and is thus almost at the upper end of the scale. The average municipal values of the nationwide heat stress index range from 0.10 to 0.66.
New requirements for investors and municipalities
The results of the analysis show that heat stress should be more strongly included in location analyses, ESG assessments, acquisition reviews and portfolio strategies in the future. Higher cooling requirements, rising operating costs and possible restrictions on use can influence the profitability and also the long-term value of real estate. In addition, there are potential investments in climate adaptation measures such as greening, shading or unsealing. At the same time, the regulatory perspective is becoming increasingly important: Physical climate risks such as heat stress are increasingly being taken into account as part of ESG requirements.
“Urban heat stress is becoming a relevant location factor. It is therefore becoming increasingly important for investors and municipalities to identify climate risks at an early stage and to include them in planning and investment decisions,” explains Sophie Nieder.
To the study
For the study, Wüest Partner developed a structural heat stress index that assesses the heat stress of settlement areas throughout Germany on the basis of climatic, urban planning and demographic factors. The calculation is carried out at grid level with a resolution of 100×100 meters and enables analyses from a nationwide overview to the specific micro layer.
Unlike a classic temperature index, the heat stress index takes into account not only the long-term frequency of hot days, but also factors such as the degree of sealing, tree population, water surfaces and the concentration of particularly vulnerable population groups. As a result, even locations with similar temperatures can have significantly different heat stress values. The study thus shows that heat stress is not only a question of climate, but also of urban structure, microlocation and building characteristics.
