Digitalization is the dominant topic in the manufacturing industry. Predictive maintenance, smart data, automation, digital twin technology have made it into the headlines of newspapers, magazines, and conferences. As digitalization is embracing all aspects of our private and professional lives, it is becoming a priority for managers and policymakers to talk about the new opportunities. In this interview we talk with Frank Talmon l’Armee, CEO of SEMODU AG, about the relevance of digital transformation in real estate industry.

Journalist:

Why is digitalization so important at SEMODU?

Frank Talmon L‘Armée:

“We can already see that digitalization is shaping our daily lives and will play an important role in many other areas of our lives in the future. That is why it is extremely important for us not only to talk about the possible implementation of digital progress, but to implement the real solutions – from words to deeds, so to speak. We at SEMODU believe that the dematerialization of physical objects is only a matter of time and therefore see an immense potential in the digital transformation of the real estate industry and especially in modular construction.”

Journalist:

We often hear about the importance of putting customers’ needs at the center when doing the product development. To what extent is this important for SEMODU and how is the customer taken into account?

Frank Talmon L‘Armée:

“Since our customer is also the final user of our product, it goes without saying that we focus on their needs. But because we are creating something entirely new, our customers are often not even aware of these needs. And this, of course, is a paradigm shift. Here in particular, we strive to clearly convey our vision of the new form of living and to demonstrate all the possibilities of individual design. Every one of our customers should be able to express themselves in their own home. And that, if he wants to, means that every day can be unique.”

Journalist:

You mentioned before the need to move from words to deeds. So how does SEMODU implement digitalization in its products?

Frank Talmon L‘Armée:

“We are currently in the process of developing a fully digitized module by implementing an intelligent building operating system. This system includes everyday objects such as an ordinary dining table being rethought, reinvented and digitally connected. The benefit for our customers lies in the simple, comfortable and adaptable living space we create. Moreover, habits are changing faster than ever. For example, the use of online tools is often the better alternative to buying products or services. That’s why we stick to the “pay-per-use” principle in order to create a wide offer that can be arranged according to individual preferences.”

Journalist:

How does SEMODU stand out from other companies, especially in terms of digitalization?

Frank Talmon L‘Armée:

“The integration of digital products into the modular construction concept is a unique selling point for SEMODU and thus a pivotal advantage in the market. With the implementation of our technological concepts, we want to significantly advance the digital transformation in the real estate sector. Our unconventional way of thinking is therefore our most important resource. The ideas and new perspectives we create not only provide valuable impetus for our work but they inspire and motivate us.”

Journalist:

Sustainability is one of the main topics of SEMODU AG, the method provider for modular construction. Why is it so important to you and what role does climate protection play? How is the industry reacting to this commitment?

Frank Talmon l’Armée:

Contributing to climate protection is a matter of the heart for SEMODU AG. After all, the real estate sector has always been one of the largest emitters of greenhouse gases. That is why we see a special need to catch up.

Wherever possible, we use wood and invest in the afforestation of forests to achieve a CO2 balance or even a positive CO2 balance with our resource-saving concepts. That our climate-friendly living concepts and modular construction are in great demand, is also evident from the numerous positive feedback we receive from city planners, architects, and decision-makers on our real estate projects.

Journalist:

Sustainability does not come at zero cost. But sustainability has been in the trend for years and is now approaching construction and real estate industries. At the same time, however, there is a housing shortage and apartment prices keep rising. How can this contradiction be resolved?

Frank Talmon l’Armée:

Little has changed in conventional construction in the last 200 years, especially with regards to sustainability. But our CO2-neutral building concepts do not necessarily have to be expensive. This is a very important point. For us sustainability has to do not only with climate protection, but also with socially acceptable living – that is why we are aiming to go away from this contradiction. With climate-neutral concepts, with regard to energy and mobility, we want to create a future worth living for future generations.

At the same time, we also know about the social importance of climate protection from SEMODU. Thus, for us, building the future and implementing sustainability are inevitably linked. Generally speaking, at SEMODU we are sending a clear signal for more climate protection and sustainability.”

Journalist:

Does the commitment to climate protection in your company and modular building offer concrete, measurable added value or is this more about making a contribution to society?

Frank Talmon l’Armée:

There is already a clear added value for us. As experience shows, the real estate industry is rather conservative and slow when it comes to innovations. Growing cities, rising property prices, rents and construction costs, the frightening climate forecasts and the changes that are already visible today will not simply disappear. These are the problems that affect all of us. From politicians, companies, cities, environmental organizations and, of course, down to every single person – everyone has to stick together to maintain a future worth living together. We have already been able to link some of these strands, but here and there we still find incomprehension or hesitance.

We do not let this slow us down, of course, but rather enter into strategic partnerships that share the same vision and are willing to push forward with us.

Journalist:

How does SEMODU implement its ambitious climate protection goals?

Frank Talmon l’Armée:

We aim to implement all our projects at least climate neutral – if not with a positive climate balance. However, we are particularly proud of our project “Am grünen Anger” in Wernau, which not only has a CO2-neutral budget, but also has a sustainable mobility and energy concept behind.
Nevertheless, we want to strengthen the environmental and climate awareness of our employees, partners, and customers. That is why we count on a broad network of partnerships and support the initiative “one for the planet”, whose founder now also belongs to the advisory board of SEMODU AG.”

Journalist:

In the above example, how do customers and third parties benefit from your climate protection efforts?

Frank Talmon l’Armée:

With our projects, we prove that climate-neutral living is quite affordable and can still meet the highest quality standards.
This is precisely what we want to achieve with our innovative energy modules and sustainable mobility concepts, which benefit our customers directly.

Journalist:

That’s wonderful. However, climate protection sometimes still requires large investments. Have you found solutions to distribute these costs fairly and socially acceptable among all parties involved?

Frank Talmon l’Armée:

A major concern since the founding of SEMODU is building affordable housing and thus the basis for social compatibility. Our modular design, whether wooden modules, concrete modules, or hybrid modules, already enables significant cost savings and in return creates more scope for implementing climate-friendly concepts. The standardized manufacturing and delivery process can be planned up to the last minute, so that the module is transported to the construction site just-in-time. Compared to the conventional construction, construction times can thus be reduced by up to half.

Journalist:

Will you expand your company’s commitment to climate protection in the coming years?

Frank Talmon l’Armée:

We always strive for more. Our vision is to create living spaces and properties that are as resource efficient as possible and that are adapted to the needs of people. That is why we never get tired of implementing new innovative concepts and are constantly working on improving our environment. The promising collaboration with a major energy company is only the beginning.

Journalist:

What does corporate responsibility and responsible corporate management mean to you personally?

Frank Talmon l’Armée:

At SEMODU, everyone has a voice – we meet at eye level. For me, corporate responsibility means recognizing and strengthening responsibilities of employees and steering them in the right direction. Our employees are the driving force behind SEMODU. In my opinion, giving them the greatest possible freedom in their work is a form of responsible corporate management.

Journalist:
Which projects and initiatives in which SEMODU has been involved in recent years had social relevance?

Frank Talmon l’Armée:

We believe that all of the projects we initiate or support have a high social relevance. And the numerous project enquiries that we receive regularly show us the success of our initiatives “affordable living” and “climate-neutral, resource saving concepts.

Journalist:
That’s the customer perspective now. To what extent does your focus on social responsibility also influence you during the selection of applicants?

Frank Talmon l’Armée:

We believe that a multicultural team brings a special diversity of talent, skills and new perspectives. Regardless of age, experience, background etc. , we are looking for the smartest and most creative minds who bring fresh air and new ideas.

Journalist:
What role do the employees of SEMODU play in the success of the company? What is particularly important to you in terms of applicants?

Frank Talmon l’Armée:

SEMODU is on a growth course – both geographically and in terms of personnel. In order to cope with this increasing workload, we always use reinforcement in the team. We appreciate the ability to work collaboratively. Working at SEMODU requires great openness to innovative thinking and willingness to challenge conventional approaches. Initiatives and new ideas of our employees are enormously important to us, and we therefore particularly encourage independent working methods.

Journalist:

What are the initiatives with which you want to make a long-term contribution to society with your company?

Frank Talmon l’Armée:

SEMODU AG is based on four main business areas: modular, digital, sustainable and productive. All those contribute to the goal of creating a future worth living for future generations. Intelligent and sustainable building modules are our path to reach these goals.

Journalist:

How mathematics impacts our built environment?

Shashank Pandey

The cycle of the environment has a rhythmic and repetitive function – from seasons to daylight hours – all follow a set pattern. Mathematical proportions are decisive in making any object look aesthetically pleasant. The ancient architecture and in some cases modern architecture make use of mathematical patterns and proportions in order to harmonize the built form with our nature habituated visual senses. The Golden ratio is one such example. Its geometrical interpretation was used by Egyptian, Greek, and Roman civilizations. The trend continued extensively in Gothic and Islamic Architecture. Modern Architects such as Le Corbusier also used mathematics as a tool in their design forms.

Journalist:

How is mathematics and modular construction interrelated?

Shashank Pandey

These two are co-related in multiple dimensions. Historical use of mathematics in buildings was restricted primarily to building forms and facade patterns. But with modular construction mathematics plays a more decisive role encompassing different facets of planning. In modular construction, other than the regular anthropometry figures, the planning team must make efficient calculation, regarding the size of the modules, ratio of module faces, weight of the modules, balance of the module, and the special technical parameters in the subject of structures and MEP.

The external factors such as fabrication plant, state traffic regulations, crane allowances, etc. bring these restrictions in play. Inefficient planning can make the project cost to shoot up.

The efficiency can be checked and compared using formulas. Planners must work under this complex mathematical umbrella. This complex constellation can be simplified through CAD (Computer aided design) planning scripts. In the future, fabrication plants will have more automatic and semi-automatic CAM (Computer aided manufacturing) processes at their disposal.

Journalist:

Can this mathematical system be used similarly across all the projects?

Shashank Pandey

This system has many variables. When looking over external factors, on one hand there are variations arising due to different state building regulations, on the other hand, different state traffic restrictions. Talking about internal factors, for example, the system devised for a residential building cannot be used as it is for an office building. Other variations arise from the material itself. Concrete, wood, steel, and hybrid construction, each have their individual mathematics. Due to the heavier weight of concrete (ca. 2400 Kg/m³), it results in smaller module sizes as compared to wood (ca. 1200-1500 Kg/m³). Additionally, in concrete, the specific fabrication process of dealing with sized formworks brings further invariable constraints in the planning process. But at the same time, due to its lean wall sizes concrete modules result in better area efficiency. All these parameters are analyzed mathematically in terms of advantages and disadvantages, material wise and project wise. Of course, this complex comparative analysis is much easier with mathematical coding and combinatorics.

Journalist:

In general, how do project processes differ in modular construction? And what impact these processes have on the cost and sustainability numbers?

Shashank Pandey

In our experience, Design-Build is the best suited project delivery method for modular construction. The planning revolves around the specific module mathematics which is customized as per the manufacturer’s system. The building modules are detailed up to the last step during the initial planning phases and are pre-finished up to the grade of 80-90% in the fabrication plant itself. Even the sequence of final module assembly and the point of connection for lifting the module is pre-determined. Last minute alterations are difficult to execute and costly to duplicate. It can disrupt the entire modular process and prolong the project duration.

The planning process utilizes the practical principle of P-P-D (Plug, Play and Design). The aim of the planner is to design the most efficient size of the module, because either smaller or bigger sizes can lead to cost escalation during fabrication, transport and onsite lifting and assembly. At the same time, planner must maximize the module repetitions to end with efficient fabrication costs. Finally, the total reduction in the project duration by 50-70% results in greater value of opportunity cost for the real estate developer.

Coming to the aspect of sustainability, the lean fabrication process and low number of design changes lead to minimum construction waste. Highly controlled quality standards make the building durable and more sustainable when calculated over the entire building life cycle. The reduction in project time leads to decrease in carbon emission in intangible ways. The grade of building material recycling and flexible project reuse possibilities add up to the sustainability quotient even further.

Journalist:

How does SEMODU ́s modules development differ from its competitors?

Shashank Pandey

Our modules and its fabrication process envision high grade of efficiency replicating the automobile industry of Germany. The priority is set on achieving module quality, rather than module quantity. For instance, our conceptualization for residential projects aims to accomplish the total planning by using minimum of one or maximum of three module sizes per project. This uniformization principal trickles down in maximization of cost, quality, and time benefits. These value engineered modules are structured to meet next generation needs and provide compact solutions. The WANDWALL digital module is being developed as a smart module tool embedded with BOS technology. This is the future of modular construction and the real estate industry at large, where we have already made significant contribution.

Jochen Dorner is our Head of Business Development and a long-standing expert in the real estate industry. He is responsible for the efficient and climate-neutral implementation of our projects and project development in general.

In the following interview, we asked Jochen about the biggest challenges in the real estate industry and how does SEMODU solves them. He also explains which sustainable solutions SEMODU AG integrates in its projects.

What are the biggest challenges in the real estate industry? And what does SEMODU do to overcome these challenges?

The real estate industry is facing a number of challenges. These include the housing shortage associated with affordable housing, the current shortage of skilled workers in the industry, climate change and the progress of digitalization. In fact, the real estate industry is one of the least digitized sectors, so the need to catch up is enormous. In addition, the challenges for the real estate itself have completely changed and must be faced by the real estate industry in the long-term as well.

What does SEMODU do? As a method provider, we work system-independently and offer our solutions according to the challenge or request of the customer. In doing so, we do not focus on just one product or material, but on the best concept for the solution of the particular inquiry. In addition, we are specialists in the rapid provision of living space, which is becoming increasingly important in view of the prevailing housing shortage.

To what extent does SEMODU counteract climate change? The concept of sustainability is deeply embedded in SEMODU’s concept. We make a promise to our customers that every one of our projects will be climate-neutral in its creation or later in its operation. To maintain CO2 neutrality, we have entered a partnership with GETEC to develop market-independent solutions. Our company appears on the market as CERO2 and develops innovative projects to enable CO2-neutral operation later on.

How is the concept of sustainability implemented at SEMODU and what role does climate protection play in this?

The answer lies in the comparison of modular and conventional construction. The latter is characterized by poor productivity and significantly high resource consumption. For this reason, the real estate sector is responsible for around 60% of all waste generated in Germany today. In contrast, the modular construction method has a significantly higher productivity and effectiveness. Here, SEMODU relies on wood as a construction raw material and, in exceptional cases, on wood-concrete hybrid buildings, which makes our projects much more resource-efficient and significantly more sustainable.

SEMODU AG receives excellent ESG rating with the qualification “Very Good” & “Sustainable”.

SEMODU AG strengthens the transformation to a sustainable economy with very ambitious goals and meaningful solutions and supports the Sustainable Development Goals (SDGs) 7, 9, 11 and 12. Furthermore, SEMODU AG does not violate any of the key exclusion criteria of sustainable investors.

SEMODU AG comprehensively incorporates sustainability potentials and risks into all business activities. The ESG department and the sustainability expertise located in various positions of the company comprehensively reflect climate and sustainability risks and impacts and are in a good position to control and reduce them.

If you have any questions or suggestions regarding the ESG rating, please contact Franziska Löhr, Head of ESG.