	Action coalition Future of the LEG

Witten, Deutschland, Fri, Oct 20 2006

Against the Privatization of LEG NRW

By privatization of the country owned social landlord Landesentwicklungsgesellschaf (LEG) the government of North-Rhine-Westphalia (Germany) intends to give up public control to over 100.000 flats, many of them in larger scale social housing schemes.

LEG today it is the largest landlord in NRW. Directly, it owns 60.000 housing units. Via holding shares of other housing companies it controls another 40.000 units. More than 1000 employees care for the housing management and maintenance. LEG also is an important developer in the field of urban renewal and re-use of wasted industrial land. 70 % of LEG shares are directly owned by the countries’ holding, the rest are owned by the countries’ bank.

By merging a couple other public housing companies LEG was founded in 1970. During its first decade LEG focused on city renewal, urban development and housing. In 1980 LEG defined one of their primal task to be development and marketing of vacant industrial land. During the following years the housing stock of LEG continuously increased, because of their increasing number of new constructions and by the taking over of other social housing companies (in particular those which fell in crisis). One of the most extreme examples to portray LEG as a "crisis solver" was when it owned "Neue Heimat". This stangs out since LEG was seen as the "savior" of 38.000 housing units from the bankrupt housing company of the trade-unions. In 1987 LEG took over these housing stocks, many of them large scale social housing schemes, for a symbolic prize of 1 Mark.

In some of the larger neighborhoods the LEG guarantees participative instruments which are unique for Germany. "Tenants councils" are elected by all the tenants and enjoy specific rights for negotiating renewal plans and other problems. They can use companies’ facilities and spaces. This attitude encouraged tenants to engage for their neighborhoods.

LEG complexes are characterized by a lot of innovative projects and programs, both regarding the built environment and social cohesion. Examples of such projects are ecological insulation improvements, upgrading of green public spaces together with the tenants, youth clubs, support for migrants’ children, free supper and new forms of managing of social mixture. Example: The neighborhood "Klausen" in the city of Remscheid enjoys having 45 social institutions and associations which coordinate themselves in a "neighborhood conference".

In spring 2006 the government confirmed plans for privatization -either of the whole company, the shares or of the housing stocks-. However, because of very complex structure of LEG, it is not easy to implement these plans. Various options had to be discussed. Thus they decided an external examination on "how" to privatize the LEG. This examination is coordinated by an international bank. Results are expected for October.

LEG is an indispensable partner in participative neighbourhood management and sustainable renewal. Its model for tenants participation is unique to the whole country. Cutting the LEG into pieces and/or selling it to private equity investors will endanger thousands of jobs within the company and in local services. Private investors will orient the company on high profit rates and therefore cut investments in maintenance and social renewal, increase rents, transform large parts of the rental housing into privately owned condominiums, build private houses at green spaces and sell parts of the stock to other speculators.

Knut Unger, MieterInnenverein Witten

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Contents at this page do not necessarily represent the opinion of the editors. The indicated authors are responsible for the content of their articles. We are not responsible for the content of linked pages. (c) Knut Unger 2004-06

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