by Friedrich Geiger
Berlin – A few steps away from the German capital’s new airport stands the Steigenberger Airport Hotel Berlin, an exclusive getaway with 322 rooms and suites, restaurants, a spa and a full-time cleaning staff.
What the four-star hotel hasn’t had since it was completed in 2012 is guests. The reason: the airport, initially scheduled to open 10 years ago, never did, and it is unclear when it will welcome its first passenger plane.
Mirage-like, the opening of the EUR6 billion ($6.4 billion) Berlin Brandenburg Airport, or BER, some 20 miles to the south of the German capital, has receded every time it appeared to inch closer. Some of the of the airport’s technical installations had flaws and the insolvencies of companies working on the construction site caused delays. For ECE Projektmanagement GmbH, owner of the Steigenberger hotel, and other local investors who are nursing losses caused by the airport’s delayed opening, it is a cautionary tale about tying one’s fortunes to a prestigious but troubled project.
“The hotel will open only when the airport assumes operations,” said Lukas Nemela, spokesman for ECE.
Some investors resisted the urge to take the plunge before 2012, when it seemed BER’s opening was around the corner, as advertised on billboards around the city. They have been standing on the sidelines ever since but haven’t put away their wallets, said Jrgen Kuse, head of the regional committee of property valuation experts. “One gets the impression that they’re all still waiting and will [invest] when the airport opens,” he said.
Initially slated for 2007, BER’s takeoff was pushed back several times due to fire-safety flaws. Deficient smoke-extraction systems and other technical mishaps caused the next opening dates in March and October, 2013 to come and go. Eventually, the state-owned company in charge of the airport, Flughafen Berlin Brandenburg GmbH, stopped announcing new launch dates. The company said recently it could provide a date only when the BER building was completed.
Berliners and visitors have had to make do with two smaller airports — Berlin-Tegel Otto Lilienthal Airport, a 1960s concrete hexagon in the northern district of Tegel, and Schnefeld Airport to the southeast of the capital. A steady increase in visitors to Berlin — overnight stays doubled in the past 10 years — and the closure of the city-center Tempelhof airport in 2008 have pushed Tegel and Schnefeld to capacity.
New problems with BER’s automatic doors and sprinklers mean there is a 73% chance the airport will open by the fall of 2018, a recent study by consulting firm Roland Berger concluded.
Instead of experiencing the boom many real-estate experts were expecting a decade ago, commercial property and land prices in the area have stagnated as prices rocketed in the rest of Berlin.
“No one could have expected that the opening of BER would be delayed for so long. It’s obvious that returns come in most cases much later,” said Alexander Fieback, a project manager of real-estate consultancy Bulwiengesa.
Among those companies that have been sitting on unused land for years is Gatelands, a joint venture of property developers OFB Projektentwicklung GmbH and Kolb+Partner.
In a 2009 press release titled “all signs point towards success,” Gatelands predicted the construction of offices, hotels and other commercial properties with an investment volume of about EUR750 million near BER.
Eight years later, the only completed building on the site is a 140-room hotel, operated by B&B Hotels, which opened in 2013. Most of the 18 parcels of land are still up for sale, “because of the delays at BER,” according to OFB spokeswoman Yvonne Keller.
ECE agreed to sell the Steigenberger hotel in 2011 for EUR59.5 million to Swiss asset manager Acron AG, which later found an investor for the property. But the parties reversed the deal in 2013 and ECE retook the property — and the regular cleaning and maintenance bills for the empty hotel.
One of the largest lots in the region went to U.K.-based developer SEGRO PLC in 2008. It has built logistics depots and office buildings, and has found tenants thanks to the site’s location near a major highway. Logistics firm Rieck Holding GmbH signed a contract for space in 2016. Recycling company Interseroh Dienstleistungs GmbH uses a depot as a repair shop. But large parts of the lot are still unused.
“We have logistics land and light industrial land and it works perfectly well even without the airport,” said Andreas Fleischer, SEGRO’s business unit director responsible for Northern Europe.
But “we’re definitely looking forward to the opening,” he said. “There is a risk it could be in 2019, and that is embarrassing, absolutely embarrassing.” (WSJ)