6 ms·

There are so many shops in Berlin where I constantly wonder how the hell they make enough money to even afford the rent. I suspect that the rapidly rising real

There are so many shops in Berlin where I constantly wonder how the hell they make enough money to even afford the rent. I suspect that the rapidly rising real estate prices in Berlin will make most of them infeasible soon, but so far Berlin is still relatively cheap compared to other cities of similar political and cultural capital.

jamil7 5y ago
Berlin is a money laundering hotspot of Europe. I think about that too when I walk past some random shop that’s never/rarely open. They may also be grandfathered into affordable leases and paying less rent than you imagine, although not sure that works as well for commercial leases as it does for residential.
- R0b0t1 5y ago
  Rent used to be very, very low. Area was basically blighted, no? Everybody was moving out of eastern Germany.
  - jamil7 5y ago
    Yeah but it's been sharply rising in the last 10-15 years and I'm not sure that the protections that exist for residential leases in Berlin exist in the same way for commercial. But still quite possible that the rent hasn't adjusted for many of these shops.
    - R0b0t1 5y ago
      Residential and business rent can be disconnected. Isn't that what happened in SF? Massive oversupply of one because they're not interchangeable. In Kansas City there are some highly gentrified city neighborhoods but then a block or two away a bunch of old warehouse-type factory buildings for rent.
      - jamil7 5y ago
        You could be right, I honestly don't know. The media here tend to mostly cover the residential side of things. You do see stories of businesses like bars and bookshops being forced out when an investor buys a whole building that includes both commercial and residential spaces.
- kzrdude 5y ago
  Small scale money laundering maybe. For the big money look at the property prices in London.
  - alex_duf 5y ago
    Serious question. I can see how to launder money in a shop, I'm failing to see how to launder money with property. Surely you can't buy a £1M property in £20 notes right?
    - maccard 5y ago
      You can pay a £1M mortgage in £20 notes.
    - deleted 5y ago
      [deleted]
jillesvangurp 5y ago
One weird thing with rents Germany is that old contracts have very low rents that barely increase over the years. So, you get this weird dynamic of very old shops and restaurants that have been there for decades paying almost nothing right next to very hip/trendy places that have to pay through their nose for the privilege of being there. Some of the older restaurants get away with this by simply charging less for their food and drinks. Newer places can literally not afford to do so. Especially West Berlin still has quite a few places that pre-date the fall of the wall 30 years ago. Lately, Charlottenburg (a big neighborhood in the West) has been gentrifying rapidly. So, you get this weird contrast between these old places and very new & trendy things opening right next to them. You see the same dynamic in East Berlin though large parts of that have been gentrified by now. I live close to the wall memorial on the East side and most of the old shops and restaurants in my area have disappeared over the last 12 years. Mostly the reason is that the business owners hit retirement age and scale down or sell their business. In some cases, a relative takes over but more often than not the place closes and some other business moves in.
- Shmebulock 5y ago
  >One weird thing with rents Germany is that old contracts have very low rents that barely increase over the years Does it really work that way all over Germany or is it something specific to Berlin?
  - turbinerneiter 5y ago
    It is more extreme in Berlin, but I think in general the spread between new rent and old rent is very high. I.e. in Munich, the average rent per square meter is about 10€, while the average for new offers is almost 17€. This is a problem because nobody is moving out of their places, so people get stuck in the wrong flat. Old people won't leave their too big places after their kids left, young people with kids live in places that are to small. (No shade thrown at the old people, I'd also not want to leave the place I lived in for so long. But on a bigger scale, it's an issue.)
  - mft_ 5y ago
    I believe Switzerland has a similar approach. Anecdata #1: a long-established barber shop paying a fifth of the rent that the very similar empty unit next door was advertised for. Anecdata #2: just too many ‘businesses’ which offered little of interest and which never seemed to have any customers; some shops even only opened for a fraction of the year (eg those selling Fasnacht regalia).
odiroot 5y ago
> There are so many shops in Berlin where I constantly wonder how the hell they make enough money to even afford the rent. Some of them are just money-laundering fronts for organised crime.

jamil7 5y ago

Berlin is a money laundering hotspot of Europe. I think about that too when I walk past some random shop that’s never/rarely open. They may also be grandfathered into affordable leases and paying less rent than you imagine, although not sure that works as well for commercial leases as it does for residential.

R0b0t1 5y ago
Rent used to be very, very low. Area was basically blighted, no? Everybody was moving out of eastern Germany.
- jamil7 5y ago
  Yeah but it's been sharply rising in the last 10-15 years and I'm not sure that the protections that exist for residential leases in Berlin exist in the same way for commercial. But still quite possible that the rent hasn't adjusted for many of these shops.
  - R0b0t1 5y ago
    Residential and business rent can be disconnected. Isn't that what happened in SF? Massive oversupply of one because they're not interchangeable. In Kansas City there are some highly gentrified city neighborhoods but then a block or two away a bunch of old warehouse-type factory buildings for rent.
    - jamil7 5y ago
      You could be right, I honestly don't know. The media here tend to mostly cover the residential side of things. You do see stories of businesses like bars and bookshops being forced out when an investor buys a whole building that includes both commercial and residential spaces.
kzrdude 5y ago
Small scale money laundering maybe. For the big money look at the property prices in London.
- alex_duf 5y ago
  Serious question. I can see how to launder money in a shop, I'm failing to see how to launder money with property. Surely you can't buy a £1M property in £20 notes right?
  - maccard 5y ago
    You can pay a £1M mortgage in £20 notes.
  - deleted 5y ago
    [deleted]

jillesvangurp 5y ago

One weird thing with rents Germany is that old contracts have very low rents that barely increase over the years. So, you get this weird dynamic of very old shops and restaurants that have been there for decades paying almost nothing right next to very hip/trendy places that have to pay through their nose for the privilege of being there. Some of the older restaurants get away with this by simply charging less for their food and drinks. Newer places can literally not afford to do so. Especially West Berlin still has quite a few places that pre-date the fall of the wall 30 years ago. Lately, Charlottenburg (a big neighborhood in the West) has been gentrifying rapidly. So, you get this weird contrast between these old places and very new & trendy things opening right next to them. You see the same dynamic in East Berlin though large parts of that have been gentrified by now. I live close to the wall memorial on the East side and most of the old shops and restaurants in my area have disappeared over the last 12 years. Mostly the reason is that the business owners hit retirement age and scale down or sell their business. In some cases, a relative takes over but more often than not the place closes and some other business moves in.

Shmebulock 5y ago
>One weird thing with rents Germany is that old contracts have very low rents that barely increase over the years Does it really work that way all over Germany or is it something specific to Berlin?
- turbinerneiter 5y ago
  It is more extreme in Berlin, but I think in general the spread between new rent and old rent is very high. I.e. in Munich, the average rent per square meter is about 10€, while the average for new offers is almost 17€. This is a problem because nobody is moving out of their places, so people get stuck in the wrong flat. Old people won't leave their too big places after their kids left, young people with kids live in places that are to small. (No shade thrown at the old people, I'd also not want to leave the place I lived in for so long. But on a bigger scale, it's an issue.)
- mft_ 5y ago
  I believe Switzerland has a similar approach. Anecdata #1: a long-established barber shop paying a fifth of the rent that the very similar empty unit next door was advertised for. Anecdata #2: just too many ‘businesses’ which offered little of interest and which never seemed to have any customers; some shops even only opened for a fraction of the year (eg those selling Fasnacht regalia).

odiroot 5y ago

> There are so many shops in Berlin where I constantly wonder how the hell they make enough money to even afford the rent. Some of them are just money-laundering fronts for organised crime.