EPRA Sustainability Best Practice Recommendations

Introduction

Company Profile
LEG Immobilien SE is a housing company focusing on the housing market of the economically strong state of North Rhine-Westphalia and its neighbouring federal states. Our portfolio comprises around 172,000 rental properties (approximately 500,000 tenants) with an average apartment size of 63 square metres and 1,443 commercial units. Our focus is on affordable housing, and our units help to meet the demand generated by the rapid rise in the number of smaller households that are typical for our market.

Our core business is the management and development of our own residential portfolio. The business model is also being actively expanded to include innovative services and new revenue models.

Headquartered in Düsseldorf, the Group had around 2,087 employees in 2024. Our properties are held by a number of LEG subsidiaries.

Since 2017, we have been reporting our performance in the areas of society and the environment and continuously expanding the scope of indicators and properties included in our reporting.

We are a member of EPRA and prepare our environmental and social reports in accordance with EPRA's Best Practice Recommendations on Sustainability Reporting (sBPR) in addition to other recognised reporting standards. Our report is divided into two sections:
 

1. General Recommendations
2. Performance Report

1. General Recommendations

System Boundaries

We have selected operational control as the criterion for defining our system boundaries. Reporting therefore only covers the properties over which we have operational control, and the utility services that we source directly as a landlord for communal areas, central services or rental areas. The only exception is data on heating energy, which was collected or extrapolated for all rented properties. For the individual performance indicators, the following share of the property portfolio is within our system boundaries:

• Electricity: We are responsible for the purchasing/settlement of all electricity consumed for common areas in the property portfolio under our management.
• Fuels, district heating and district cooling: We are responsible for the purchasing/settlement of all fuels or district heating for around 55 % of the property portfolio under our management (2023). The remaining gap was calculated using projections based on energy certificates for around 44 % and based on the building age cluster for around 1 %.
• Water: We are responsible for the purchasing/settlement of all water consumed in the property portfolio under our management.
• Waste: We are responsible for the removal and disposal of the waste generated by the rental properties for the entire property portfolio under our management.
• Employees: The reporting relates to all persons employed directly by LEG, including its wholly owned subsidiaries LEG Wohnen NRW (which is responsible for the operations management of our properties) and LEG Management (which monitors all corporate governance areas). Employees at joint ventures, such as TechnikServicePlus (TSP), are partially excluded as they are not fully under our operational control.
• Site health and safety and community betterment: In all the properties under our management, we are responsible for performing health and safety inspections, for compliance with regulations and for the betterment of the community.
• Governance data relate to LEG’s Supervisory Board and its Management Board.

Data Collection

Unless stated otherwise, the absolute performance indicators for fuel consumption, district heating and district cooling, building certification, site health and safety, and community betterment relate to 100 % of the apartments that fall within the system boundaries defined above.

The data collected for electricity consumption relate to 97 % of the apartments within our system boundaries (2023: 97 %).

The water data collected relate to 47 % of the apartments within our system boundaries. The other 53 % are excluded as we have no consumption data for them.

The waste data collected relate to 27 % of the property portfolio under our management. For these apartments, we use our own service provider that is entrusted with waste management and collects data on the waste volumes generated. These data are then converted into tonnes using a conversion factor.

Estimates of utility services billed to the lessor

The data on electricity and water for 2024 are entirely estimated as the actual consumption data were not yet available by the editorial deadline. These estimates were made by calculating the absolute data and consumption indicators on the basis of the consumption data for 2023 and extrapolating this to reflect disposals and additions in 2024.

The data for heating and fuels for 2024 are based on estimates as the actual consumption data were not yet available by the editorial deadline. The estimates were carried out based on the following methodology: results of the 2023 climate balance, minus disposals in 2024, plus additions in 2024.

The estimates for electricity, water, heating, and fuels for 2023 used in the previous year were replaced by the actual consumption data for 2023.

The waste data are reported by a service provider that operates as the waste manager for around 27 % of our property portfolio. The combined volumes of the waste containers provided for these properties by LEG were analysed. These volumes are not always the same as the waste containers’ actual fill volumes. Also, these figures do not add up to the actual volume of waste at these properties, as some of the waste is disposed of in public containers which are emptied directly by the local council.

The volumes collected in the waste containers provided by LEG are converted into tonnes using general conversion factors for the various types of waste. These conversion factors were marked up by 10 % as the waste containers hold an above-average volume of waste (except organic waste) thanks to the service provider’s active waste management. Conversion factors: residual waste: 0.11 t/m³; recyclable materials: 0.033 t/m³; paper, card, cardboard packaging: 0.22 t/m³; organic waste: 0.25 t/m³.

Boundaries – Reporting on Consumption Billed to the Lessor and the Tenant

The data for electricity and water relate only to the consumption (based on meter readings and bills) that LEG purchases as the lessor for communal areas/central services or private apartments (and which is subsequently billed to the tenants). Data that are billed to tenants directly (i.e. bills that tenants receive directly from their provider) have not been taken into account.

Analysis – standardisation

We have calculated the consumption indicators on the basis of floor area (square metres) for entire buildings, including rental apartments. We are aware that our method for calculating consumption indicators has a discrepancy between the numerator and denominator, as we only receive electricity bills for communal areas, but the bills for fuel, district heating, district cooling, and water consumption for communal areas/central services and rental areas (it is not possible to separate these consumption data).

Performance Indicators for Health and Safety

These are calculated using the following formulas:

• Injury rate = number of reported injuries / total number of workdays
• Work loss rate = number of workdays lost (from three and upwards) due to workplace injury / total number of workdays
• Absence rate = number of days missed due to illness / total number of workdays

Analysis – Segment Analysis (by Property Type, Geographical Location)

The segment analysis is based on the property classification used in our financial report (see 2024 annual report). Our investment portfolio comprises around 171,706 apartments and 1,608 commercial units.

In our segment analysis, we do not distinguish between residential and commercial units as they are located in the same buildings and therefore the consumption billed to the lessor cannot be separated.

A further segment analysis by geographical location is not relevant as 79 % of our apartments are in North Rhine-Westphalia and the remaining part in other German states and are therefore in the same climate zone.
 

Period of Reporting

Absolute performance indicators and consumption indicators relate to the last reporting year (2024). Like-for-like analysis of the performance indicators for electricity, water and heating energy relates to the last two years for which we were able to collect actual consumption data (2023 and 2022). As we only use actual consumption data, we can analyse the effects of efficiency improvements in our like-for-like portfolio, which would not be possible with estimated data. For further information, see “Estimates of Utility Services Billed to the Lessor.”

However, the like-for-like analysis for waste relates to the years 2024 and 2023, as the corresponding waste volumes are available for these years.
 

Information on Administrative Buildings

All administrative buildings are reported from the 2023 calendar year onwards. Information was provided from eleven locations, both internally and externally rented properties.

Data are recorded for 100 % of our space, and all available consumption data are reported.

The combined volumes of the waste containers were analysed to calculate the waste quantities. These volumes are not always the same as the waste containers’ actual fill volumes. The volumes are converted into tonnes using general conversion factors for the various types of waste.

Data review and quality assurance

All data calculated are checked for consistency and coherence before being added to the reporting database. There is no external review or quality assurance at this time.

Performance Report

Environment Action Area

Energy Consumption and Emissions

Based on the 2023 reporting year, energy consumption and emissions were extrapolated for the 2024 reporting year by adjusting for the 2024 portfolio changes.

The electricity consumption figures are based partly on measured data and partly on extrapolations from the costs posted on the basis of samples.

In 2024, the energy consumption billed to the landlord will fall slightly based on the projection due to portfolio changes in the entire property portfolio: a reduction of 0.1% was calculated for the electricity consumption billed to the landlord and a reduction of 2.87% and 2.80% for the consumption of fuel and district heating billed to the landlord. The energy consumption figure for our property portfolio has been reduced by 2.42%.

Scope 1 emissions declined accordingly by 2.76 %. Scope 2 emissions decreased by 2.43 % in the location-based analysis and by 3.94 % in the market-based analysis. Based on the consumption indicator, climate-adjusted Scope 1 and Scope 2 emissions for heating energy fell to 27.0 (location-based) and 22.7 (market-based) in kg CO2e/m²/year.

Scope 2 emissions based on electricity billed decreased by 1.1 % compared to 2023. The consumption indicator remains unchanged at 0.16 kg CO2e/m²/year.

In the like-for-like analysis (calculated using actual consumption data from 2023 and 2022), the energy consumption indicator for electricity increased slightly by 3.01%. Heating energy consumption showed a slight reduction. Fuel consumption decreased by 0.02 %, while district heating consumption dropped by 3.89 %.

GHG emissions in the like-for-like analysis decreased by 54.5 % for Scope 2 electricity emissions. This is due to a decreased share of renewable energy. Accordingly, the consumption indicator decreased by 55.6 %.

Scope 1 emissions decreased by 1.7 %, and Scope 2 emissions for heating energy decreased by 6.8 % (location-based) and 7.9 % (market-based) due to the transition from fuel to district heating. In terms of the consumption indicator, this trend in Scope 1 and Scope 2 emissions for heating energy in kg CO2e/m²/year can also be observed: The metric decreased by 3.6 % (location-based) and 3.3 % (market-based) compared to 2023.

Scope 3 emissions for upstream heating supply (3.03) amounted to 85,064 t CO2e, and for household electricity (3.13) to 159,938 t CO2e. This corresponds to a slight increase of 0.09 % compared to the previous year.

Further information on our measures to reduce energy consumption and GHG emissions in our portfolio can be found from page 153, ESRS E1: Climate Change, in our annual report.

Water

Absolute water withdrawal decreased by 0.01 % in 2024 compared to 2023. The water withdrawal parameter remained stable. In the like-for-like analysis, consumption decreased by 0.21 % between 2023 and 2022. Accordingly, the water withdrawal parameter indicator remained unchanged in the like-for-like analysis. All water comes from the municipal water supply.

Further information on our water management activities in our property portfolio can be found in our Water Policy at:

www.leg-wohnen.de/en/corporation/sustainability/codes-and-guidelines/policies/water-guideline

Waste Disposal

The total weight of waste collected in the 27 % of apartments for which we collect data decreased slightly by 0.01 % between 2023 and 2024. 60 % of this is residual waste, of which only a small proportion is sent to landfill, while the majority is used for energy recovery in waste incineration plants. In the like-for-like analysis, the total weight of waste collected in the apartments for which LEG was able to gather corresponding data remained constant between 2023 and 2024.

Due to the relatively low coverage of our waste data and the applied calculation methodology, it is difficult to draw conclusions about our overall performance. Nevertheless, we implement various measures, such as raising awareness among our tenants, to reduce the amount of waste.

Building Certification

Building certification refers to energy performance certificates currently available for approximately 98 % of our property portfolio (based on floor area). The majority of individual apartments (around 82 %) have an energy efficiency certificate in efficiency classes D to H, which is due to the relatively high age of our buildings. Since 2018, a slight improvement has been achieved in our property portfolio thanks to the ongoing energy modernization program.

Society Action Area

Diversity

LEG is committed to ensuring a balanced workforce composition and gender equality. Around 35.6 % of our direct employees and 25 % of our managers are women. The ratio of the basic salary and remuneration of women to that of men is 106.6 % for all employees and 83.9 % at the management level. Differences are solely due to length of service and seniority. Since this year, employees of TechnikServicePlus GmbH (TSP) have also been included in the key figures.

Further information on our approach to diversity can be found in our Employee and Diversity Policy at:

www.leg-wohnen.de/en/corporation/sustainability/codes-and-guidelines/policies/employee-and-diversity-policy

Training and Continuing Professional Development

LEG actively promotes initial and further training and supports its employees’ career growth. In 2024, each employee completed an average of 14.9 training hours on various compliance, professional topics, and career development opportunities. Additionally, 87 % of employees participated in an annual professional development interview. These conversations serve as a dialogue between employees and managers, offering insights into employees' skills and competencies. Employees also have the opportunity to discuss the support they need, their job satisfaction, and how they would like to continue developing within the company.

Further information on our approach to employee training and professional development can be found in our Training and Continuing Professional Development Policy at:

www.leg-wohnen.de/en/corporation/sustainability/codes-and-guidelines/policies/training-and-further-education-policy

Turnover

In 2024, 253 new employees were hired, corresponding to a new hire rate of approximately 12.1 %. At the same time, 229 employees left the company, resulting in a turnover rate of 11.0 %. Further information on initiatives related to our employees, including employee engagement, satisfaction, and retention, can be found in the Training and Continuing Professional Development Policy mentioned above:

www.leg-wohnen.de/en/corporation/sustainability/codes-and-guidelines/policies/training-and-further-education-policy

Health and Safety

Given the nature of the work, LEG generally assesses the risk in the area of employee health and safety as low. This is confirmed by an injury rate of 0.0001 % in 2024 and a work loss rate of 0.17 %. The most frequent reason for absences is illness, with an absence rate of 6.7 % in 2024.

LEG systematically and comprehensively ensures site safety through both its own employees and service providers, who inspect and check buildings and facilities. Around 98.7 % of our property portfolio underwent such a health and safety review in 2024. If any defects or accident risks were reported, tradesmen were immediately commissioned. After the work was completed, the rectification of defects was checked and documented.

Further information on our approach to employee and tenant health and safety can be found on page 166 (ESRS S1: Own workforce) and from page 175 (ESRS S4: Consumers and end-users) of our annual report.
 

Community Betterment

In 100 % of the properties under our management, we organize community betterment activities. These activities include a variety of measures aimed at increasing tenant satisfaction, promoting social cohesion, encouraging people to be good neighbours, boosting local communities and responding to social challenges.

Further information on our approach and examples of some of the numerous initiatives we carried out in our property portfolio in 2023 can be found from page 175 onwards, under "Consumers and end-users", and from page 114 onwards, under "Tenants", in our annual report.

Governance

Extensive background information on our governance performance indicators, a profile of the Supervisory Board, and a description of our nomination processes and how we handle potential conflicts of interest can be found on page 23 ff., page 31, and page 94 ff. of our current annual report, as well as on: 

www.leg-wohnen.de/en/corporation/leg-group/members-of-the-management-and-supervisory-board

and 

www.leg-wohnen.de/en/corporation/sustainability/codes-and-guidelines.

Mr. Michael Zimmer, as the Chairman of LEG’s Supervisory Board, has extensive social commitments and has initiated or personally founded various foundations. Mr. Zimmer serves as the Chairman of the Board of Trustees for the following foundations: Your Home Helps – Foundation of the LEG Immobilien Group: www.dein-zuhause-hilft.de, CORNELIUS – Foundation for the Children of Addicted Parents: www.cornelius-stiftung.de, Der bewohnte Garten – Foundation for the Promotion of Contemporary Art: www.derbewohntegarten.de. He is therefore an expert in the areas of environment and society. All three members of the Management Board are experts in the areas of the environment and society.