This idea convinced a team of founders with veterans of the real estate, construction and technology industries. For example, Florian Fritsch is the chairman of the supervisory board. The founder of Kalrock is a real estate developer and successful investor in tech start-ups. People from Lieferheld/Delivery Hero and Zalando are also on board. The president of the Austrian Chamber of Commerce, Harald Mahrer, is a member of the supervisory board.
The company’s CPO (Chief Production Officer), who is responsible for product development and production, is a well-known name in the timber industry: Bernd Oswald, who formerly worked for KLH, Mayr-Melnhof Holz, Mondi or Cree.
The following conversation was held with Oswald in Vienna in the tasteful rooms of Wolfgang Rosam, head of communication at Gropyus.
In the past two years, the team of founders developed detailed ideas for a system which aim at changing the construction process. Oswald defines a holistic approach to the use of resources and bases it on three central aspects:
The housing construction sector is independent of the state of the economy. Affordable housing is always needed. Production is sometimes necessary to create more added value. We also produce in order to have financial advantages, not merely for the sake of producing.
For the first aspect, sustainable raw materials are required. Therefore, Gropyus primarily relies on timber constructions. Elements have to be manufactured in an intelligent way so that they can be separated or replaced once assembled. “This requires a completely new construction process. Currently, a building contractor acquires a property and has an idea for its use. An artist – the architect – creates a small piece of art. Then, a construction engineer transforms this prototype into a plan, which is subsequently adapted for every purpose by everyone involved in the project: construction company, plumber, electrician, timber construction company. As a result, planning costs are exploding,” Oswald explains the current situation, using the European construction sector as an example.
Gropyus wants to do everything from the acquisition and development of properties to the construction of detached four to eight story buildings in big cities. Oswald: “However, we are also partners for developers and offer them a platform for building sustainably, on time, on budget and fast. For us, the lower limit is 10,000 m² projects. The components for those can, but don’t have to be produced by us, but we assemble all the elements ourselves. We also rent out all the apartments. None of them are sold.”
“Every construction element is optimized in terms of its function. The aim is to use as few resources as possible and to guarantee that elements are in use for as long as possible. Through systematic digitalization and automation, we want to offer rents below 10 €/m² depending on the location of a building. This is considerably less than what is currently being paid. And yet our buildings impress with their design and materials. They are of higher quality than the classic new residential buildings and this includes quality of living, too. This approach is new in so many aspects, which is why we are so interesting for many investors,” explains Oswald.
Gropyus’s buildings have a passive house standard and all are equipped with photovoltaic facades. “A conventional building contractor would want to sell the apartments, but this type of facade would be too expensive for that. However, since we look after the buildings until the end of their life span, photovoltaics make sense,” Oswald argues and adds: “The primary goal is to use the building for as long as possible at the lowest production and operating costs.”
For the time being, Gropyus will only be operating in the DACH region, where the company sees the “biggest backlog in construction”. Dozens of country-specific building regulations were high hurdles. “Nonetheless, we have the permits for constructing eight-story buildings ourselves in all the cities of our choice,” says Oswald proudly. “The system is the same everywhere. The only differences are in the dimensions.”
Gropyus works exclusively with system components. “Nevertheless, the necessary degree of individualization is possible,” says Oswald. For this construction system, timber construction engineers, programmers, architects and mechatronics engineers were brought together. These have to make sure that all building components fit together - systemically, spatially, functionally. “If you control all the steps from planning to rental, you can reduce inefficiency in all stages between,” Oswald sums up. The highest possible digitization is the core of Gropyus. Parallel to the physical building there is a digital clone. The company wants to get better with every building they construct.
Gropyus’s actual customers are the tenants as users of the multi-story buildings. Until the construction of those, the company works exclusively for itself. Not all construction elements are manufactured in-house, but they are assembled. Oswald explains it by using the automotive industry as an example: “There are many suppliers for one platform, but everything is assembled at TESLA.”
In December, Gropyus acquired Mayr-Melnhof’s glulam production in Richen. Oswald explains this step with the fact that Gropyus will also use glulam for the construction of its buildings. Currently, the company is planning ten projects. “We are already receiving glulam for those. Mayr-Melnhof markets the rest for us. In a year or two, we will need everything for ourselves,” predicts Oswald who emphasized several times during the conversation that Gropyus is not primarily a producer. “Rather, production is often necessary in order to create more added value. We produce when it has financial advantages.”
Oswald negates that there will be further takeovers in the timber industry. “We have the supply chain under control. Almost all timber construction products are commodities which can be bought at short notice. We will use others to satisfy our demand,” he says regarding his approach. “Our approach is that of final finishing with a significantly higher value in relation to volume."
Another company was acquired in 2019: Gropyus Engineering in Steinhaus near Wels with currently more than 20 employees. The company is supposed to manufacture the robot manufacturing cells which produce the construction elements. “It is not just about automating manual processes. The first question we ask is: What must the end product be able to do? And then we think about how to get there,” says Oswald. “When a robot only holds the parts of a frame wall and nails them together like a human, it is not a quantum leap. If, however, the function of the frame wall is optimized and the wall is then manufactured at the lowest cost, something new is created. That’s how additional intelligence comes in.”
Oswald is not an unconditional fan of CLT. When it comes to this product, he sees an “innovation process from behind”. “Sawmills thought about what they could do with sideboards. The use for constructions was only secondary.”
Gropyus would need CLT, but “with cable trunkings – but this doesn’t exist yet. At the moment, CLT is actually devouring too much wood. The ratio is not right yet”.
Florian Fritsch, chairman of the supervisory board; founder of Kalrock, real estate developer and investor in start-ups;
Dr. Harald Mahrer, vice-chairman of the supervisory board; president of the Austrian Chamber of Commerce;
Bernd Oswald – CPO, product development and production
Goal: creation of high-quality, resource-efficient and affordable housing
System: prefabricated, fully integrated timber system constructions through digitalization, automation and prefabrication
Employees: 160 (beginning of 2020)
Finances: Gropyus is fully financed through equity, borrowed capital is used to finance projects
Foundation: In 1919, architect Walter Gropius founded the art school Bauhaus. It stands for puristic and clear architecture which offers a high degree of wellbeing and focus on details which can make a big difference. 100 years later, Gropyus was founded.
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