Rents rise as luxury brands return to West Berlin
West Berlin's Kurfuerstendamm is in fashion for the first time since Germany's reunification as luxury brands snub the east, pushing rents higher.
Apple may be the next company to appear on the 4km boulevard known as Ku'damm, in the capital's most expensive shopping district. The iPhone maker will open a store there, its first in the city, this year, a person with knowledge of the plan said.
The decision by fashion brands such as Hermes and Louis Vuitton to focus on west Berlin has shifted attention away from Friedrichstrasse, the eastern strip that attracted most retail investment after the fall of the Berlin Wall in 1989. That helped rents for the best space on Ku'damm to climb the most in 15 years last year, an increase that was more than twice the rate for Munich's top shopping street, broker CBRE estimates.
"Berlin's west has always been important, but the east was new and waiting to be discovered," said Andreas Malich, the head of Berlin retail leasing at CBRE. "For a long time, nobody knew which way the old lady of the west would go."
Apple's new store will be at a former cinema, the people said. The building has a facade resembling a Greek temple, in contrast to the modern structures that dominate Friedrichstrasse.
Apple declined to comment on plans for the store. Ku'damm has had Berlin's biggest concentration of luxury shops since the 1920s. Kaufhaus des Westens, the city's most famous department store, is also nearby. The store, known as KaDeWe, is cited by David Bowie in a new song about his memories of living in the city during the 1970s.
Foreign investors are trying to profit from the west's revival by acquiring some of its most prestigious properties. In October last year, AXA Investment Managers and Norway's sovereign wealth fund agreed to buy Neues Kranzler, a retail and office complex on Ku'damm, for about €380 million (HK$3.96 billion).
Last month, Austrian real estate company Signa agreed to acquire KaDeWe itself in a €1.1 billion deal.