EU's Largest Regeneration Project Hits Milestone

EU's Largest Regeneration Project Hits Milestone

Commercial News » Europe Commercial News Edition | By Cathy Hawker | October 31, 2013 9:24 AM ET

HafenCity, Europe's largest inner-city development project under construction in Hamburg, has reached the midway stage of its projected 23-year build.

At this point 56 projects have been completed in the development, located on a 157-acre waterfront site beside the Elbe, and a further 46 projects are under construction or planned, according to Jürgen Bruns-Berentelg, chief executive of HafenCity Hamburg GmbH. The total investment is projected to be €8 billion of private funds and €2.4 billion of public resources.

HafenCity stands out from other regeneration projects in several aspects. Its central location means that unlike Docklands in London, which is six miles from the city center, HafenCity is just 800 meters from Hamburg's town hall. Secondly HafenCity is truly a mixed-use development. The project, scheduled for completion in 2025, aims to create a functional mix of 50 percent workspace, 30 percent residential, and 20 percent devoted to culture, leisure, retail and education, including 45,000 jobs, 6,000 residential units.

HafenCity centers on Speicherstadt, the old warehouse area created between 1883 and 1927 and largely rebuilt after WWII bombing. The area was abandoned once the new container terminal was built on the river, but HafenCity has transformed the former port area into an urban expansion of the inner city, linking the redbrick warehouses with downtown Hamburg and effectively creating a city within a city.

Building at HafenCIty started in earnest in 2002 and development is progressing from west to east and from north to south with plans for 13 new urban quarters. The western area is largely completed, and has 2,000 residents and a wide range of shops and restaurants.

Summing up recent progress at HafenCity, Bruns-Berentelg highlighted the educational facilities being developed. In early 2014 HafenCity University (HCU) will open with 2,000 students, joining Kühne Logistics University and Medical School Hamburg, which moved into new buildings at Grasbrook in September 2013. These are in addition to The International School of Management and a satellite of The Frankfurt School of Finance and Management which opened in 2010 and 2012 respectively.

In the first three quarters of 2013 20,000 square meters of property was let, priced between €11.00 and €24.00 per square meter. A further 40,000 square meters remains available for rent.

The Überseequartier covering 13.7 hectares is the commercial heart of HafenCity and the central link to the waterfront. Its completed infrastructure includes a metro station with direct access to Hamburg, kindergartens, parks and playgrounds. The southern part of this region awaits development subject to the City of Hamburg's final decision on whether to focus on retail, commercial or residential usage.

Latest figures show that 450 companies have relocated to HafenCity, employing 9,000 people. Significant office tenants include Unilever and shipping conglomerate Kühne & Nagel, while BP and Hajin Shipping both opened offices this year. Gebr. Heinemann's headquarters - the extension of two existing warehouses dating from 1877 - won awards for its architects von Gerkan, Marg and Partners in May 2013.

The project has not been without delays, most notably to the modern glass and red brick concert hall, Elbphilharmonie, designed by architects Herzog and de Meuron and set to become Hamburg's new landmark. The building, incorporating a 2,150-seat auditorium, hotel and 45 apartments, was initially set to open in 2010.

"The new opera house had all relevant contracts with the building company HOCHTIEF renegotiated in April 2013 and completion is now scheduled for October 2016," said Andreas Wende, managing director of investment at Savills Germany. "The 45 residential units of 100 to 300 square meters on the building's west side with views over the Elbe and harbor were offered for sale at €16,000 per square meter for bare brickwork and were oversubscribed several times."

Hamburg is Germany's second largest city and also the wealthiest per capita. Property prices are highest in the established residential areas beside the Alster Lake.

"As a completely newly-built quarter HafenCity is an inspirational site," said Hilke Branding-Rettig of German developers Frankonia Eurobau. "The appeal and cachet of waterside residential units means that €6,000 per square meter for a new apartment on the Elbe is easily achievable."

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