The Elbtower construction site in Hamburg has been at a standstill since the end of October and the project company has now filed for bankruptcy. As the Urban Development Authority announced on Friday, the city can now assert its right to buy back and take over all planning and construction contracts.
According to authorities, Elbtower Immobilien GmbH & Co. KG is obliged to inform the city of the bankruptcy filing. When the application was filed, an event of “economic deterioration” occurred according to paragraph 10.7 of the real estate purchase agreement.
The city will also protect its rights in the insolvency proceedings and will contact the provisional administrator immediately after the appointment, the authority said.
Corporate network in trouble
The project company Elbtower is an indirect subsidiary of the already bankrupt Signa Prime Selection AG of the Tyrolean real estate investor René Benko. During the low interest rate period, he took out cheap loans, got financially strong investors and thus significantly expanded his Signa Group. But recent increases in interest rates, construction costs and energy prices have put his complex network of businesses in trouble.
The urban development authority assumes that a private solution will be found for the resumption of construction work in the context of the insolvency proceedings. However, significant changes to the overall project could only be made with the city’s permission. The city’s buyback right gives the city the ability to take control of the project if a viable solution is not found, the city said.
Planned to be 245 meters high, 100 meters have been built so far
With a height of 245 meters, the Elbtower should become the crowning glory of Hamburg’s Hafencity. It should be built in the far east near the Elbe bridges, as a kind of counterpart to the Elbphilharmonie in the far west. Planned delivery and total costs to date: 2025 for approximately 950 million euros. At a height of 100 meters, the contracted construction company stopped work because bills were not paid. Germany’s third tallest building, designed by London’s star architect David Chipperfield, will one day house offices, shops, galleries and restaurants.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
