The Chicago-based artist Theaster Gates has won the 2017 Kurt Schwitters Prize, which will culminate in his first solo museum show in Germany. The international jury for the award said they chose Gates for his “urban projects” in places like Chicago and Kassel and his ability to “activate socio-political energies that can alter entire neighbourhoods”.

Gates has yet to start work on the exhibition, due to open at the Sprengel Museum in Hannover in late 2017, but visitors can expect more of the same from the self-described “social practice installation artist”.

For his Dorchester Projects, begun a decade ago, Gates has been rebuilding his South Side neighbourhood, which had previously been gutted by poverty and crime. In 2006, the artist made his home in a former candy store in one of the city’s most rundown areas. Dubbed the Listening House, it accommodates 8,000 albums from the closed Dr Wax record store. Since then, the artist has bought other buildings, transforming them into archives, places for video workshops, soul food dinners or housing for artists and community members.

Gates also used material from his Dorchester Projects for his Documenta exhibition in 2012, shipping debris from the original Black Cinema House on South Dorchester Avenue to Kassel, Germany to repair a historic building known as the Huguenot House. More recently, the artist staged his first public project in the UK at the end of last year, which saw Gates transform a bombed out church in Bristol into a site for music and spoken word performances.

Later this month, the artist is showing his Negrobilia series for the first time in an exhibition at the Kunsthaus Bregenz, Austria (23 April-26 June). These new works are based on a collection of racist artefacts depicting Afro-Americans, first assembled 30 years ago by the prominent Chicago banker Edward J. Williams, who acquired them to remove the offensive images from public view.

According to its website, the Kurt Schwitters Prize honours artists “whose work is distinctive for venturing into new realms of artistic creativity and artistic imagination, or whose work contributes to linking and integrating the artistic genres”. The award is worth €25,000. In January 2015, Gates won the prestigious Artes Mundi prize in Cardiff and shared the £40,000 prize with the nine other finalists.