Tel Aviv vs. Berlin: The same hotel – more than double the price

The price difference between hotels belonging to the same chain in the two cities is so high that Israelis could spend a week-long vacation in the German capital – including a flight and a hotel room – and pay much less than for a Tel Aviv hotel alone.

Israelis thinking of travelling to Berlin this summer in order to check the prices of pudding, for example, should know that the trip could easily turn out to be cheaper than a vacation in Tel Aviv. Much cheaper, in fact.

A Yedioth Ahronoth inquiry reveals a significant price gap between a hotel in the Israeli metropolis and a hotel belonging to the exact same chain in the German capital, so that even if you add the price of a flight to Berlin – the vacation abroad will still cost you less. (Continue reading…)

Hot German Homes Get Too ‘Speculative’ for Berlin Landlord

Germany’s housing market is becoming prohibitively expensive and it’s time to prepare for a downturn, according to the head of the country’s second-largest landlord.

While some investors are willing to outbid each other in a bet that home values will continue to rise, rents don’t justify the prices being paid, Deutsche Wohnen AG Chief Executive Officer Michael Zahn, 52, said in an interview. Instead, the Berlin-based company is scaling back acquisitions and refinancing debt.

“There’s a limit to how much I’m willing to pay,” said Zahn, who has almost tripled the company’s portfolio to 150,000 apartments in three years. “Opportunities to refinance right now are much more attractive than acquiring.”

The German publicly held residential sector, now dominated by Deutsche Wohnen and its main competitor Deutsche Annington Immobilien SE, has grown tenfold since 2012 as new companies raised money in stock offerings, bought rivals and accumulated apartments. Deals have been financed with record levels of debt and share sales as companies take advantage of low interest rates and strong demand for real estate from international fund managers. (Read more…)

Berlin’s New Rent Control Laws Are Already Working

The “rental price brake,” introduced on June 1st, is the city’s most comprehensive tool to date for keeping rent affordable.

The law is intended to hinder galloping rent rises in a town that has seen inner city tenement districts become increasingly unaffordable, pushing long-term residents out and destroying the vibrancy that made these areas attractive to live in in the first place. This process started with inner districts like Kreuzberg, currently the site of a passionate, surprisingly high profile fight to save a local grocery store. But it doesn’t stop there. Such is the ripple effect that gentrification has even been noted in the pleasant but eternally unhip outlying district of Spandau.

To counteract this, Berlin has already introduced some other laws intended to stop real estate hotspots from overheating. The city has acted upon national Community Defense laws that allow it to pinpoint areas where rents are rising especially fast and forbid luxury conversions that would otherwise give landlords a legal right to raise rents. The city has also banned vacation rentals in some places to prevent much needed permanent accommodation from seeping away from the rental market. However, the rental brake is the most comprehensive tool introduced to date.

The new laws could prove especially strong and durable in Germany because of other pro-tenant legislation already in existence. German tenancies are typically long—in fact, they are generally open-ended. This means tenants can stay in their apartments for decades on the same contract, with just some small rises permitted within the terms of the contract. German tenants can also not be evicted on a whim. They can only be thrown out for misbehavior or failing to pay rent, or if the landlord proves that she wants to move in and use the apartment as her own permanent address. Take all this together and you have a pretty tight net of legislation forming to keep rents manageable. Meanwhile, concerns that rent control will cause the supply of apartments to dry up have been partly appeased by a city-wide building program that should deliver 30,000 new rental apartments over the next decade. (read more…)

Berlin growing twice as fast as expected

The Berlin senate revealed on Monday that the capital is growing at double the pace that city planners had previously expected. But after decades of stagnation the growth is seen as positive.

The senator responsible for city development, Andreas Geisel, announced in the senate’s chamber that the city administration’s previous prognosis that a population increase of 250,000 over 2011’s figure would now be achieved by 2019, rather than 2030 as previously expected, reports Die Welt.

In 2014 alone the city’s population grew by 44,700 people.

Berlin growing twice as fast as expected

Population growth is putting strains on city planning. Photo: DPA

 

The senator responsible for city development, Andreas Geisel, announced in the senate’s chamber that the city administration’s previous prognosis that a population increase of 250,000 over 2011’s figure would now be achieved by 2019, rather than 2030 as previously expected, reports Die Welt.

In 2014 alone the city’s population grew by 44,700 people.

“The growth of our city is a great blessing,” Geisel said, arguing that after decades of slow or negative population growth the new trend was “a chance for us all” and something that couldn’t be stopped even if people wished it.

But the fast pace of population growth is also placing strains on the city.

House prices, rents and the costs of building plots are increasing at an ever faster pace.

Geisel warned that in the last 12 months the price of a plot of land has increased by 30 percent, an increase he described as a “crazy.”

“When we build, we need to build densely,” said the senator.

Geisel also outed himself in favour of reducing restrictions on separating industrial areas from living spaces and cutting down bureaucracy that controls building on green spaces and places of historical importance.

To this end the senator proposed the establishment of a ‘building permit acceleration law’ which would offer developers shortcuts around planning bureaucracy.

The senator also promised that population growth would not lead to car traffic clogging up the city.

Only five percent of the increase in transport in the city is car traffic, said Geisel.

The state would invest in cycle lanes and increasing bus routes, the ex-mayor of Lichtenburg promised.

(Original article – http://www.thelocal.de/20150707/politicians-struggle-to-keep-pace-with-berlins-growth)

The Secrets of Soho House Berlin: Lessons in Colorful Real Estate

In the five years since its 2010 opening, Berlin’s iteration of Soho House has become a major Central European roadhouse. The signature loungy-luxe details honed by Soho House founder Nick Jones, 52, since he opened his first Soho House in 1995—in Berlin’s case, the tidy little roof pool, the fireplace with its art-directed logs, the Vegas-style couches and day beds for extra-louche group lounging—all conspire mischievously to imply that the authorities, such as your momma, your significant other, or, in a celebrity’s case, a howling pack of street-dog paparazzi would have a really hard time finding you enjoying the place with whomever you choose.

This is a very profitable and fantastically marketable lodging idea. Although the traditions of it hark back to the 12th century Knights Templar and the London guilds and clubs, its authors in the late 20th century in the U.S. are the disco-magnate-turned-hotelier Ian Schrager (Morgans) and the dater-of-Uma-Thurman Andre Balasz (The Mercer, The Standard). In this market, Mr. Jones, of the UK, is a relative latecomer. (read more here…)

IREIT Global buys Berlin property for S$217.7m; undertakes rights issue to fund deal

Singapore-listed IREIT Global Tuesday said that it had reached a deal to acquire a property in Berlin for 144.2 million euros (S$217.7 million), marking its first acquisition since its initial public offering.

The property is located in the district of Lichtenberg, and the company said this place had been witnessing a strong growth of both commercial office development and occupancy demand.

The property comprises two fully connected building sections of 8 storeys and 13 storeys, respectively, the company said in a statement.

It is located six kilometres east of Berlin’s city centre and near the Media Spree area, which is popular with internet, media and technology companies.

IREIT said it was was attracted to this property due to the strong principal tenant – Deutsche Rentenversicherung Bund –  a federal pension fund and the largest of the 16 federal pension institutions in Germany, and the opportunity for rental and value growth in this increasingly popular location. The principal tenant DRB occupies 98.8% of this property’s total lettable area on a lease expiring in June 2024 and contributes 99.6% to its gross rental income.

Choo Boon Poh, Chief Financial Officer of IREIT said, “As part of our strategy, we intend to fund the acquisition through a mix of equity and debt. IREIT has announced a rights issue to raise gross proceeds of approximately S$88.7 million. The balance of the funding for the acquisition will be through a bank loan facility, from which it intends to draw down a gross amount of approximately €102.0 million.”

With this acquisition, IREIT’s total portfolio value will increase significantly to €438.0 million (S$661.4 million) from €290.6 million (S$438.8 million).

Regarding its renounceable rights issue, it will offer 189.6 million new units at 46.8 cents, and shareholders will be entitled to subscribe to 45 rights shares for each 100 shares held.

Tong Jinquan, Lim Chap Huat and IREIT Global Management who own a total of about 76.5% of the existing units have demonstrated their commitments by subscribing to their allotment of rights units, the company said.

The REIT closed 0.5 cent higher at 80.5 cents on Monday.

As of 31 March 2015, IREIT Global’s portfolio comprises four freehold properties in Germany valued at approximately €290.6 million (S$438.8 milion). The four properties are located in the key German cities of Bonn, Darmstadt, Münster and Munich with net lettable area of about 121,506 sqm and 2,945 car park spaces.

(source – http://www.dealstreetasia.com/stories/ireit-global-buys-berlin-property-for-s217-7m-undertakes-rights-issue-to-fund-deal-8502/)

Berlin: The Startup City That’s Still Starting Up

My flight landed here in Germany’s capital city at about 8 a.m. on Saturday after a long, overnight journey from New York City. Despite my burning, blurry eyes, and having been here only about a day or so, one thing is immediately clear: the startup scene is alive and well in Berlin.

I’m here for a few days this week attending the sixth annual Dell Women’s Entrepreneur Network Summit. It’s an appropriate city for the event. Visit neighborhoods like Mitte and Kreuzberg and at once you are submerged in a vibrant, maturing world of startups, with founders coming here from all around the world.

But, as with any startup hub, Berlin has its flaws, too.

Nestled in northwestern Germany on the banks of Rivers Spree and Havel, Berlin — as we all should be well aware — is a city with a complicated history. In 1945, after After World War II, the Western part of the city was controlled by the United States, the United Kingdom and France while the Eastern part was controlled by the then Soviet Union. With the rise of communism came a more permanent division — the Berlin Wall — which separated West Berlin from the rest of the country from 1961 until the end of the Cold War in 1989.

Today, Berlin’s 3.5 million residents are creating a bright, new history for their city — and business is often at the heart of it. “Because Berlin was cut off during the decades of the Cold War, it is a capital again, but not with the usual infrastructure around it,” explains Nicole Simon, a startup mentor and head of publisher sales and blogger relations at Berlin-based blogfoster.com. “The city itself is a startup.”

What attracts entrepreneurs to Berlin

The creative industry is vibrant here — music, fashion, film, art and design — and it attracts tourists and entrepreneurs from all over the world. Two other important details that attract businesses: a still relatively low cost of living and a relaxed visa-application process. You can start a tech company in Berlin and attract top software engineers from around the world without jumping through the typical visa process in the U.S.

“The startup scene for me is a very heterogeneous group of people who are intrinsically motivated to change the status quo,” says Markus Schranner, who moved to Berlin in 2011 and serves as chairman of entrepreneur advocacy organization Startup Germany. In addition to the arts, Berlin seems to attract numerous tech companies (green tech, financial tech, insurance, online privacy, etc.) as well as social entrepreneurs, he says.

Berlin’s notable startups include Soundcloud, 6Wunderkinder, ResearchGate, Number26 and Delivery Hero, to name just a few. Larger tech companies also have outposts in Berlin, including Microsoft, Google, Lufthansa and Volkswagen.

(read full article here  – http://www.entrepreneur.com/article/247781)