Tschentscher: Hamburg prepared for an emergency with Elbtower

Signa insolvency - Tschentscher: Hamburg prepared for an emergency with Elbtower

Hamburg's mayor Peter Tschentscher believes that the city is prepared in the event of a total failure on the part of Elbtower investor Signa. "The likely scenario is not that nothing will happen for five years," the SPD politician told the German Press Agency. It is possible that the private investors will find a solution and continue building - as they have announced. "Even in insolvency proceedings, the city would secure its contractual rights." This would include a repurchase right, which the city would not have to implement immediately. This would leave sufficient time to examine the situation. "In the event of a repurchase, we would refund the original purchase price of 122 million euros without interest and minus five million euros and in return receive the property back."

From Tschentscher's point of view, the project is not yet a disaster because it is possible to continue building at any time and is also economically advantageous. Unlike the Elbphilharmonie, the risk of the Elbtower lies solely with the private investors. "The city will not take on any unpaid bills," said Tschentscher.

The Elbtower is to be the crowning glory of Hamburg's HafenCity. It is to be built in the far east near the Elbe bridges, as a kind of counterpart to the Elbphilharmonie in the far west: "64 storeys, 245 meters above the sea. A new view of the city," says the Elbtower website. The third tallest building in Germany, designed by London star architect David Chipperfield, will house offices, stores, galleries, restaurants and a viewing platform on the 55th floor, among other things. Planned completion date and total costs: 2025 at a cost of around 950 million euros.

Standstill on the construction site since October

However, nothing has been happening on the Elbtower construction site since the end of October. At a height of 100 meters, the commissioned construction company Adolf Lupp from Nidda in Hesse has stopped work. Signa had not paid invoices, Managing Director Matthias Kaufmann told the "Hamburger Abendblatt" newspaper. Allegedly, around 37 million euros are involved. Signa itself did not initially comment on this when asked.

The real estate entrepreneur René Benko had taken out cheap loans during the low-interest phase, gained financially strong investors and thus greatly expanded his group. However, the recent rise in interest rates, construction costs and energy prices have put his complex network of companies in a precarious position - so much so that Signa Holding and various sub-companies have already filed for insolvency.

City decides on future of the property in the event of bankruptcy

Most recently, Signa Prime Selection AG (Innsbruck), which is responsible for the Elbtower, was hit on Thursday. According to the city development authority, it is the indirect parent company of the purchasing company of the Elbtower property, Hamburg Elbtower Immobilien GmbH & Co KG, which is not yet insolvent. Tschentscher said that should a buy-back take place, "then the city can decide, for example, whether to reallocate the property and the project. Theoretically, it would also be possible to demolish the building and use the property for other purposes. However, the most likely option as things stand today is that the Elbtower will be completed - "and with exactly the architecture and type of use that was agreed".

Tschentscher: Investors were carefully selected

With regard to critics who had already warned of Benko's business practices before the contract was awarded, Tschentscher said that Signa had been carefully selected - not by politicians alone, but in the first step by a jury of internationally active urban planners, architects and real estate experts. They had assessed the architectural quality and the likelihood of realization. "The jury selected the Signa Group's bid after careful consideration," said Tschentscher. HafenCity Hamburg Entwicklungsgesellschaft, the Senate and the City Parliament then confirmed the jury's decision.

Tschentscher did not want to draw a comparison with the other two major projects that have been lying idle for years - the Paloma district in St. Pauli and the Holsten site in Altona. "Bayerische Hausbau is a reputable company that had a hard time implementing a concept in the Paloma district in St. Pauli that meets the high demands of the district and the district's politics." The case with the Holsten Areal is completely different. "The agreed concept could have been implemented there a long time ago, but the property was sold on several times for speculative reasons."

Mayor criticizes speculators

There is justified criticism of this, from politicians and from many serious project developers in Hamburg. The city has always stood by its promises. "Unfortunately, our contacts have been changing and have repeatedly issued new invoices to somehow realize the higher land price that they have to generate," said Tschentscher. The last owner of the Holsten site, which has passed through several hands, is the financially troubled Adler Group, which operates from Berlin but has its legal headquarters in Luxembourg.