Interview: Professor Hansjörg Geiger

Professor Dr. Hansjörg Geiger describes himself as a functional pessimist. "I see the critical developments, but I think about how we can respond to them so the crisis doesn't materialise." Geiger knows a thing or two about crises. In the mid-1990s, he served as President of the Federal Office for the Protection of the Constitution (Bundesamt für Verfassungschutz) and later as President of the Federal Intelligence Service. The Bundesamt für Verfassungschutz is the equivalent of the UK's MI5, or in the USA, a combination of the FBI and parts of the Department of Homeland Security.

His views on security policy carry considerable weight, not least regarding the real estate industry. We are grateful to editor Markus Gotzi and his publication Der Fondsbrief for the following interview, which first appeared in Der Fondsbrief.

Der Fondsbrief: Professor Geiger, are you concerned about current developments?

Hansjörg Geiger: I'm certainly concerned about our situation. Our economic system is the foundation for peace and prosperity, and all of that is under considerable pressure.

Are we already at war with Russia?

Geiger: We're already seeing numerous clandestine actions by Russia. But China is also becoming increasingly aggressive. Xi Jinping wants to be number one, so he's stepping up his opposition to the West. He's set himself the goal of significantly weakening our system.

Not to mention Trump in the USA.

Geiger: Trump is dismantling democracy, and I see no resistance in Congress. He's pursuing a policy driven by revenge. He's causing massive damage to the West with his words and actions, and China will be the beneficiary.

How can we respond appropriately?

Geiger: We mustn't bury our heads in the sand and fail to react—we need to take action. The coalition agreement offers some good approaches. The question is whether we can implement the necessary reforms. Germany and other European countries have become saturated societies. I see extreme individualism, even selfishness.

What consequences do you think this will have on property markets?

Geiger: We need changes in the legal system so individuals can't block or delay projects for years with lawsuits. Otherwise, investors won't stand a chance. Incidentally, we need to build barracks quickly and cost-effectively to maintain our defence capabilities, since many have been sold off. In Kempten in the Allgäu region, for example, there used to be three barracks. None exist anymore. If I were managing a real estate company, I'd be thinking about how to get involved—how and where to secure sites for barracks.

How can new barracks be built cost-effectively?

Geiger: You can already build quickly and cheaply using industrial components. This is standard practice in residential construction. The existing barracks for our current 180,000 soldiers also need comprehensive renovation—they're in poor condition.

Is the real estate industry prepared for changing times and everything that comes with them?

Geiger: I'm afraid not all companies have recognised the signs of the times—and I mean the entire economy. I can't understand why Rheinmetall publicly announces its new production sites. Or why a new digital signal box for Munich's S-Bahn gets detailed media coverage. That makes it easy for Putin and other aggressors to target with missiles. I find this naivety frightening.

Wouldn't Putin find out anyway?

Geiger: He'd first have to hire spies—people to scout locations. In the past, ammunition depots were located just kilometres from towns, yet no one knew about them.

What additional risks threaten real estate?

Geiger: Cyber attacks pose a fundamental risk, including for real estate. Hackers can completely paralyse offices, hospitals and smart homes. All they need to do is cut the power supply. Without electricity, nothing works—not even toilet flushes, because water pumps need electricity. And if Russia detonated a nuclear bomb in the atmosphere, properties wouldn't be destroyed, but the entire network would be. If we only had digital land registers, no one would know who owned which properties.