I know this construct from the region where my ancestors came from (eastern part of Styria in Austria). But instead of »genannt« the latin word »vulgo« is used. »Vulgo« means »commonly«, »generally« or »usually«, but is used here in the sense of »usually named«.
This is an examle for such a name:
Johann Gruber vulgo Jungerder
In other regions of German speaking countries it might be, that »genannt« is used.
Johann Gruber genannt Jungerder
The origin of this names is the medieval epoch, or maybe even before, the migration period. In those time people had no family names. But the granges and farms where they lived had names. So when it came to tell apart two people who had the same given name, but who lived at different farms, then the name was build as <given name> from <name of the farm>.
Walther von der Vogelweide
Aristocratic names were build using the same scheme, where the farm name was replaced by the name of a castle
Rudolf von der Habichtsburg = Rudolf von Habsburg
In later times family names developed parallel to the farm names. So people had a given name, a family name and a farm name.
Wolfgang Schmied vom Steinhof
The given name was given by the parents, the family name was inherited from the fathers family name, and the farm name was the name of the farm where someone was born and grew up, or, in case of farmhands and servants, where they worked (and therefore lived).
In case of aristocrats the farm/castle name mutated to the family name:
Nowadays the modern names in German spoken countries are build only from the given name(s) (many people have more two or given names, but everybody has at least one) and the family name. Most people even don't have a farm name, but if they have one, it is not part of the official name. So in official documents the farm name (if there is any) is not used.
But even in 21st century there still are rural regions, where the owners of old farms are known to their neighbors not under their official family name, but under their farm name.