Mayor: Hamburg prepared for Signa exit with Elbtower
Published: Friday, Dec 29th 2023, 05:30
Updated At: Saturday, Dec 30th 2023, 00:59
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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," he 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," said Tschentscher. 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."
In Tschentscher's view, the project is not yet a disaster because it is possible to continue construction 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 floors, 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 cost: 2025 at a cost of around 950 million euros.
Standstill on the construction site since October
But since the end of October, nothing has been happening on the Elbtower construction site. At a height of 100 meters, the 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.
Real estate entrepreneur René Benko took out cheap loans during the low-interest phase, attracted 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 property in the event of bankruptcy
Most recently, Signa Prime Selection AG (Innsbruck), which is responsible for the Elbtower, was hit on Thursday. The company owns commercial properties in prime locations, including the Elbtower, the KaDeWe department store in Berlin and department store properties belonging to the Galeria Karstadt Kaufhof chain. According to the city development authority, Signa Prime Selection AG is the indirect parent of the purchasing company of the Elbtower property, Hamburg Elbtower Immobilien GmbH & Co. KG.
The Swiss subsidiary Signa Retail Selection is already in debt restructuring moratorium. It holds the German department store chain Galeria, for example, as well as the Signa Group's 50 percent stake in the Swiss department store group Globus. The remaining 50 percent of Globus is held by the Thai Central Group.
Tschentscher said that if a buy-back were to take place, "then the city can decide whether to reallocate the land and the project, for example. Theoretically, it would also be possible to demolish the building and use the land 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".
©Keystone/SDA
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