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Urban Development Funding
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Grant
Last updated: 14.6.2025

Urban Development Funding is a key program by the federal and state governments for the sustainable development of German cities and municipalities. It provides financial assistance for investments aimed at strengthening locations, protecting the climate, and fostering social cohesion. The program is characterized by its comprehensive approach to urban challenges and mandatory citizen participation.

Who is funded?

Urban Development Funding primarily targets cities and municipalities in Germany that plan investments in future-proof and sustainable urban and local development. Within these funded municipalities, property owners and investors can also indirectly receive support. The program aims to enhance the quality of life and attractiveness of urban and rural areas.

What is funded?

The program supports a wide range of comprehensive urban development measures that serve sustainable urban development. These include investments in vibrant centers, social cohesion in neighborhoods, and the sustainable renewal of areas affected by structural changes. Climate protection measures are also an integral part of the funding.

Type and Scope of Funding

Urban Development Funding primarily takes the form of grants, with the federal government covering a fixed share of the eligible costs. The exact funding amount can vary depending on the type of measure and the financial conditions of the municipalities. A total of 790 million Euros was provided for 2023.

Conditions and Requirements

Funding is tied to specific conditions that regulate application and project implementation. These include the spatial demarcation of funding areas, the creation of integrated urban development concepts with citizen participation, and the obligation to implement climate protection measures.

Application Process

The application process is multi-stage and involves both the states and the federal government. Municipalities submit their applications to the states, which consolidate them into state programs and submit them to the federal government for approval. The allocation of federal funds then goes to the states.

Urban Development Funding is based on the Administrative Agreement on Urban Development Funding 2023/2024, which regulates the provision of federal financial assistance to the states. It is also closely linked to the German Building Code and other national and international urban development policies.

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Funding Overview

Maximum Amount

Maximum Amount:

33 1/3 % to 50 % of eligible costs

Award Channel

Award Channel:

Shared Management Subsidies

Region

Region:

Germany

Sectors

Sectors:

Environmental and Climate Protection, Information and Communication Technology, Social Enterprises, Cultural Institutions, Transportation and Logistics, Other

Funding Stages

Funding Stages:

Planning, Implementation, Infrastructure, Process Optimization, Capacity Building, Experimental Development

Funding Provider

Program Level: National

Funding Body: Federal Ministry for Housing, Urban Development and Building (BMWSB)

Managed By: Federal States

Website: Bundesministerium für Wohnen, Stadtentwicklung und Bauwesen (BMWSB)