Munich – Property developers and construction investors in Munich have been able to make big profits for thirteen long years. Apartments and houses are selling like hot cakes, even though real estate prices are constantly rising. Demand remains high as loans are available at very low interest rates. That will be over in 2023. After Russia’s war of aggression against Ukraine, the ECB quadrupled mortgage interest rates. In addition, the costs for energy, building materials and tradesmen’s services are rising. Potential buyers are now holding back; building has become significantly more expensive.
The construction pit in Sendling, known as Sendlinger Loch, has now filled with water. © AZ The construction pit in Sendling, known as Sendlinger Loch, has now filled with water.
von AZ
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The crisis will also hit Munich in full in 2023. At the beginning of the year the first property developers went bankrupt. Others put themselves in passive mode and wait. The number of building applications fell by 31 percent compared to the previous year. And not even half of those who get a permit in 2023 start building. There is no longer any trace of a construction boom. One consequence: more and more Munich residents are fighting over vacant rental apartments.
Standstill and uncertainty: Problems in ongoing construction projects in Munich
The construction crisis is now visible in many corners of the city: properties are lying idle, construction sites are at a standstill. One example is the construction pit on Alramstrasse, the “Sendlinger Loch”. Apartments are supposed to be built here, but nothing is happening. Only the level of the water that collects in the pit rises and falls depending on the weather. Real estate developer M-Concept lacks buyers to even get a bank loan to get started. There is also a problem with another M-Concept project: In the Paseo Carré on Landsberger Strasse at the corner of Offenbachstrasse, buyers who have paid a lot of money cannot move in on time.
There are also problems at Nordbad, where a Karstadt used to stand. There has been no further construction for months. © iko There are also problems at Nordbad, where a Karstadt used to stand. There has been no further construction for months.
by iko
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A huge construction site at Nordbad is also standing still. A new commercial building is to be built where the Karstadt once stood. Investor Sedlmayr Grund is backing out. In July he announced that he was initially only building 254 instead of 1,066 apartments on the site of the former Bayern barracks. Finally, the well-known Munich project developer Euroboden (Hochbunker, Derzbachhof) has to file for bankruptcy.
Heart of the Benko Group Signa now also insolvent: fuss about …
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Another sellout in Munich: the Free State of Bavaria is selling off the fillet pieces
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“Of course that worries us”: Munich’s debts continue to explode
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At the end of the year of crisis in the construction industry, there was a real earthquake: Signa Holding, owned by the Tyrolean real estate investor René Benko, filed for bankruptcy, as did Sport Scheck and the real estate division Prime Selection. The latter includes the Alte Akademie, Oberpollinger and the former Hertie at the train station. Nobody can currently say when or how things will continue. The future of Galeria employees is also uncertain. The department store chain is also part of Signa.
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2023-12-28 13:56:42
#Construction #earthquake #Munich #Investors #running #steam
