Property development at BER: Interview with Thomas Doll, Managing Partner of TREUCON Real Estate GmbH
Many factors contribute to a building boom in southern Berlin. One of these factors is the scheduled opening of the BER, contributing to a strong development dynamic of the real estate market.
Thomas Doll is Managing Partner of the TREUCON Group Berlin. His company is investing heavily in BER, the area around the new Berlin-Brandenburg Airport. Angela Rüter, Managing Director of Heuer Dialog, asked for his assessment:
Angela Rüter: Offices, co-working spaces, convention halls, and restaurants are to be built on the site of Berlin's new airport: a lucrative opportunity for the real estate industry?
Thomas Doll: If you had asked me this question in the fourth quarter of 2019 before the COVID-19 pandemic, my answer would have been very euphoric; 7 months later, one has to look at this topic in a more nuanced way. All in all, however, the major international airport BER will provide the necessary positive impetus for the property industry. But you can also see, especially in the debate about the consequences of COVID-19, just how vulnerable the topic of co-working spaces will be in the future. Larger conventions won't be taking place for months and even the dining options at the world's major international airports have almost come to a standstill. I was recently in Munich and it was terrifying to see the sheer emptiness of the terminal at a Lufthansa hub designed to handle some 50-60 million passengers a year. In May 2019, 4.3 million passengers departed from Munich; in May 2020, that number was just 39,000. You can see what risks this also entails for operators of complex airport properties. That is the lesson of COVID-19.
Angela Rüter: 60,000 jobs could be created at BER airport. How realistic is that?
Thomas Doll: BER and the airport area have grown steadily over the past 10 to 15 years. The airlines themselves and, in particular, Lufthansa's technology division have contributed to this growth. But we shouldn't forget Rolls-Royce in Dahlewitz or DAIMLER in Ludwigsfelde, either. Those, too, are a part of the new airport's immediate surroundings. TESLA is a new international player that the Berlin-Brandenburg metropolitan region and especially the state of Brandenburg can be very proud of. It's clear what a sensible policy encouraging companies to settle in Berlin-Brandenburg can do if the policymakers are also ready to set the right course. This is now possible due to the change of government in the state of Brandenburg and I would predict that the economic zone around BER will allow for these job figures to be met by 2030. Compare what happened with the growth around Erdinger Moos when they built Munich Airport. Since the closure of Munich-Riem, the development of the so-called "northern axis" between Schwabing and Erding has been exemplary.
Angela Rüter: Are "high-quality, urban, sustainable neighborhoods" emerging at BER the way Airport CEO Engelhart Lütke-Daldrup would like?
Thomas Doll: I've known Professor Lütke-Daldrup since 2012 when he was still State Secretary in the Berlin state government. As project developers in Berlin, we have proven time and again since 1994 that creating livable, urban neighborhoods does not mean having to accept any loss in quality, even if, as in our case, they have mostly built as affordable housing. With the Am Lückefeld neighborhood, we realized our first major residential construction project with a total of 126 apartments in 9 city villas. It was important to us that we could combine the proximity to BER with maximum living quality. This also includes modern noise protection, for which the Berlin-Brandenburg airport company also recommends appropriate development programs to the project developers. We would like to realize further construction projects around BER, the bottlenecks are similar to other building lots being developed in Berlin at reasonable prices. That's an issue.
Angela Rüter: Idea and concept and not just price play a role in winning tenders. The right way at BER?
Thomas Doll: As a residential project developer, we primarily focus on the neighborhood concept itself. Living today is more than just accommodating a family in a two or three-bedroom apartment. Public transport plays a greater role than before as do the location of day care, schools, and other essential infrastructure. In Blankefelde-Mahlow near BER, the municipality has achieved all this in an outstanding way over the past 30 years since the Wall came down. Almost all municipalities around BER have, in fact, become boomtowns. Many have their populations double since the 1990s. This brings opportunities, but also risks. The careful designation of new development areas creates the conditions for opportunity-oriented growth.
From my point of view, there is no doubt that BER will be one of the fastest growing economic regions in Europe by 2050, and COVID-19 won't change that. And, at some point, the much sought-after direct long-haul flights to America or Asia will start. I trust that Lufthansa will make better use of the potential here in the future than it has in the past, when it was not possible for economic reasons. It's not enough to fill an A380 with 600 people if this group wants a transcontinental flight for $500. It takes a lot of business travelers, it needs a full cargo hold, and it also needs a full first and business class. All of this will not be available from BER in 2020. But here, too, a lot will change in the future. Lufthansa, which has just been saved with taxpayers' money, will not be able to pull out of the BER region, which is home to some 4 or 5 million people. Otherwise, their travel needs would be served by other airlines and that would be a wrong signal. In this respect, as always, I trust the forces of the free social market economy.
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