Berlin is a city of contradictions. The dress code is terminally casual, except for the suits and ties of the Bundestag. Startup companies raising billions of euros in capital funding are setting up shop in buildings once occupied by squatters and artists. It’s not so much that these parties aren’t on the same page; they’re reading entirely different books.
Nowhere is this clash between old and new more visible than in Friedrichshain-Kreuzberg. Residents of the district, once divided by the Wall but fused after reunification, overwhelmingly vote for the eco-friendly Green Party and the post-communist Left. But the communal houses and anarchist outposts are getting some new neighbors: A Google Campus, a new Zalando headquarters and, across the canal, a second location for startup incubator Factory.
Everybody agrees: Berlin should not become another San Francisco. The tech gold rush turned the Bay Area into an overpriced playground for the nouveau riche. Residents fret that startups could threaten Berlin with the same fate. Rents in Berlin, which have risen by 75 percent in the past five years, are low in comparison with other world-class cities but are hard for long-time residents to pay. “Compared to New York and San Francisco, it’s still cheap. But paying up to 30 or 40 percent of your income in rent is extraordinary,” says Gero Bergmann, an executive at real-estate bank Berlin Hyp.
Outside an anarchist bookstore in a basement in Kreuzberg, people gathered on a Sunday last fall to brainstorm tactics for protesting the Google Campus down the street, slated to open this fall. Their reasons for opposing the digital giant’s presence were many: Fighting gentrification in general, opposing the increasingly detached way humans interact with each other, protesting the mass collection of personal data. The puritanical work ethic embodied by American tech startups fundamentally clashes with the spirit of Berlin, where many workers get six weeks of vacation a year, weekends are holy and quitting time is practically law.
From Google’s view, Kreuzberg is a perfect location: Mozilla, WeWork, Native Instruments and many other tech companies are already there, and they wanted to connect to that existing network. “Kreuzberg has fertile soil for creative people,” says Rowan Barnett, the head of Google for Entrepreneurs in Germany, noting that Konrad Zuse built the world’s first programmable computer in his parents’ Kreuzberg home in 1941.
Coworking hub Factory was attracted to the area for the same reason: when you bring creative people together, they come up with ideas that wouldn’t have been sparked in isolation. The new Factory Görlitzer Park building, technically in Treptow, has room for up to 5,000 people, and the 70-strong leadership team of Factory moved from its original Bernauer Straße location late last year.
Ramin G. Far, who succeeded Udo Schloemer as Factory’s CEO in the fall, says they’ve gotten “fewer complaints than expected,” and the district has been supportive. “It’s important to bring the whole neighborhood in and develop it together,” Mr. Far says. “We’re just one of many neighbors.” Factory’s press person, Rebecca Krum, describes Factory as a traffic driver: “If thousands of people are coming to work here, that leads to more business for restaurants, dry cleaners, cell phone stores…”
Not all the residents are thrilled with their new neighbors. Since the new year, Google’s Campus and Factory have been attacked with paint and stones. A campaign from France called “Fuck off Google” has marched in protest.
In 2016 Mr. Schloemer bought a former post office in Friedrichshain that had been a home for artist studios called PostOst since 2003, ostensibly as a possible location for an additional Factory outpost. The 50 tenants proposed schemes of adding space to the roof of the building but were evicted that fall. Factory declined to discuss PostOst with me recently, but a representative speaking at re:publica last year claimed to be unaware of the evictions until they happened.
While the artsy vibe of Berlin is a major attraction for startups, space for working artists is being lost at a rapid pace. “If there is no space, there is no art,” says Boris Joens of PostOst. “Berlin is normalizing somehow,” says Martin Schwegmann, a city official responsible for securing artists’ studios in Berlin. “Because of this absence of market pressure before, Berlin could develop differently. It’s a city that is cooperative, inclusive, allows for different lifestyles.”
Florian Schmidt, the urban development councilor for Friedrichshain-Kreuzberg, says Factory and Google and Zalando all follow the same patterns: “They buy the building and kick everybody out and then sell the thing as a creative space. It’s Silicon Valley urbanism.” It’s notable that whatever Mr. Schloemer decides to do with the former PostOst building will require Mr. Schmidt’s approval. “They really ignored us, but they use the city for their marketing, and it makes me angry,” he said.
Mr. Schwegmann says there are 8,000 to 10,000 fine artists in Berlin, and the city subsidizes 700 studios. But the city needs another 4,000 studios to meet demand as it’s losing 350 every year to development. “The need is so urgent that we need to invest in privately owned places,” Mr. Schwegmann said. “That only works if we have a long-term perspective, like renting for 20 years, at least 10.” The city government has set a goal of building 2,000 new artists’ studios by 2020 and has been working on converting a former government building into a mixed use development including ateliers.
“There’s a big competition for space in the city that wasn’t there 10 years ago,” Mr. Schwegmann said. The current Berlin Senate is focused on producing as much housing as possible. “But for 10 years nobody wanted to invest in (artists’ studios), and now I see a crisis ahead for production and cultural spaces.”
“Startups and creative companies need space, and that’s fair enough,” he said. “But there needs to be a mechanism and politics to balance these needs — the free market won’t.”
Read the whole series
Part I:The Berlin paradox: Striving for equitable urbanization without gentrification
Part II:The clash of capitalism and collectivism in Friedrichshain-Kreuzberg
Part III:Berlin’s real estate Robin Hood
Part IV:Lessons from urbanization in Berlin's past
Grace Dobush is an editor with Handelsblatt Global in Berlin. To contact the author: