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Karstadt Revisited: Neukölln’s new palace of realty speculation

Our political blogger examines Signa's plans to rebuild Karstadt - who stands to benefit?

Who stands to benefit from Signa’s plans? Photo: IMAGO / Steinach

When I think about the old department store on Hermannplatz, I can’t avoid a feeling of nostalgia. The Karstadt building, with two massive towers, opened in 1929. Europe’s biggest store was on the edge of a very red neighbourhood, and this building was a backdrop for lots of class struggle:

  • The protagonist of Klaus Neukrantz’s novel Barricades in Berlin carries cement sacks on the construction site.
  • The series Babylon Berlin staged a communist demonstration next to the uncompleted building (not quite historically accurate, but still beautiful).
  • Recollections of local communists describe how unemployed workers would use riots as a chance to steal cameras from the store, in order to trade them for food or rent.

That building was destroyed by the Nazis in the final days of World War II. It has since been rebuilt as a Karstadt, but with only three stories instead of six.

We are living in a time of endless reboots — not just in movies, but also in architecture. After the useless and reactionary City Palace got rebuilt, the lords of the city apparently have nothing better to do than reboot the old Karstadt. And no one will deny that the colossus from the 1920s was exceptionally cool.

The Austrian company Signa, run by the billionaire René Benko, has for several years wanted to tear the current Karstadt down and put a copy of the old one in its place. Berlin’s Interior Senator, Andreas Geisel of the SPD, has said he wants the project approved in 100 days. Apparently people need “reasons to go to Hermannplatz and shop, or live and spend time there.” 

Think about this for a second: In the last couple of years, have you heard anyone say that what cities need is more retail space? Or an expansion of department stores, of all things?

Of course not. Even before the pandemic, the Galeria Karstadt Kaufhof was in free fall. Last year, it asked for bankruptcy protection. So what could possibly justify an investment of almost half a billion euros to create a massive new store? Signa is losing money from its retail business — and simultaneously making huge profits from speculation with its flagship stores in city centers.

The current Karstadt on Hermannplatz was opened in 2000. I have bought a mouth guard, some fancy mango jam, and other assorted products there. If you go, you will see the space is in perfectly decent shape. The reconstruction would not actually create more retail space. The whole point would be to add additional floors for other, far more valuable forms of real estate.

Normally, getting approval for a construction project like this would require a long process involving the public. So far, things have not been going well. The district council of Friedrichshain-Kreuzberg has opposed the plan from the beginning. (The building is on the Kreuzberg side of the square.) The building departments of both Kreuzberg and Neukölln were not enthused. There was supposed to be a “public forum” last December. But even at this carefully stage-managed event with limited participation, they couldn’t find many residents to support Signa.

That’s why Berlin’s Senate, and especially the new mayor Franziska Giffey, are trying to circumvent the normal planning process. Last year, former mayor Michael Müller (SPD), along with Klaus Lederer (Linke) and Ramona Pop (Greens), signed a deal with Signa. The district would normally be responsible, but here the Senate has taken over because they said it’s about saving jobs.

Galeria Karstadt Kaufhof employs a few thousand people in Berlin. Signa has said they would maintain these jobs for 3-5 years, in exchange for construction permits to build several palaces of realty speculation. Karstadt employees are being held hostage by speculators: “Hand over the approvals or we’ll kill these jobs!” But think about the time frame: Signa would still be free to fire everyone before their new castle is even completed.

The most bizarre part of this story: Signa has recently announced that they have revised their plans to make them more “environmentally friendly.” Instead of demolishing the entire building, they are now willing to leave the steel skeleton in place and rebuild with wood. You don’t need to be an engineer to understand that there is simply no way to tear down a perfectly good building and replace it without releasing vast amounts of CO2. The climate demands leaving this in place.

Neukölln needs so much: housing, schools, day care centres, cultural spaces. The one thing we do not need is a Consumption Temple — especially when retail is just a front for their Signa’s other interests. A majority of working people in Berlin voted to expropriate big landlords and put the realty market under some level of democratic control. But most of the city’s politicians — even the so-called “social democratic,” “left,” and “green” ones — are only interested in handing over more of the cities to speculators.

Nathaniel Flakin’s new anticapitalist guide book Revolutionary Berlin is available now from Pluto Press. 304 pages, €18.99 / £14.99.