An Israeli real estate firm based out of Luxembourg is set to profit massively from Germany’s migrant crisis. Currently, the Berlin Senate is preparing to approve a plan to pay the firm €157 million to accommodate 1,500 migrants in an office complex until 2035 in Berlin’s Westend.
The Aroundtown group is already earning €143 million for an accommodation in Lichtenberg in the east of Berlin. The Senate was set to decide on the building’s future on Dec. 11, but that decision has now been pushed back to January due to opposition from the Christian Democrats (CDU) and various citizens’ groups. If it eventually goes through, the company would earn €300 million over the next 10 years in total between the two different projects.
German news outlet NIUS has reviewed court documents related to the case. The building at Soorstrasse 80 is located in the middle-class Berlin Westend, and according NIUS, the Senate is ready to pay a “whopping” sum to house the migrants, far higher than what the actual real estate market in the area would normally be able to obtain.
“A state government that dreams of diversity and sustainability has no qualms about doing business with a real estate company based in Luxembourg that could not care less about the concerns of local residents,” writes NIUS.
Germany: Berlin locals express fear over plans to house 1,200 migrants in 3 massive high-rise hotel buildings. Politicians in LIchtenberg say they were not even consulted in the matter. https://t.co/pDQ9la9T2I
— Remix News & Views (@RMXnews) November 4, 2024Notably, Berlin is run by a Christian Democrat (CDU) mayor, Kai Wegner, who is notably extremely pro-migrant. His government has been actively looking for accommodations for migrants as the Berlin-Tegel reception center, which is housed in the former airport, is currently overflowing and facing massive problems.
The office space in Westend, which is 32,000 square meters of space, would earn the Israeli-owned firm an extraordinary sum of money.
According to the documents obtained by NIUS, the agreed to rent per square meter is €25.02 per square meter per month. Included in this sum is €8.80 per square meter for “conversion and refurbishment measures” because the real estate company is paying for converting the office tower into a migrant shelter.
A Syrian migrant earns €13,000 a month from housing underage migrants in his apartment, but thousands are also being paid out to companies arranging the whole thing. https://t.co/mYt5z39lnR
— Remix News & Views (@RMXnews) October 22, 2024However, the real estate portal ImmoScout24 states that the average rent in the area is €14.46 as of October 2024, which means the rent is nearly twice as high as market rates. In addition, of the 32,000 square meters in the space, only 23,000 square meters can actually be used, according to the State Office for Refugee Affairs.
However, the building management costs are also extremely high, equaling an additional €10 per square meter compared to the average of €2.79 for Berlin renters. That is three times as high as average. The Senate will pay €1.2 million per month based on these sums, which will be increased at a rate of 3 percent per year due to annual rent indexation.
In total, the real estate firm will earn €156.7 million over the course of 10 years, far higher than market prices.
Private security firms in Berlin are cashing in on the refugee crisis — earning millions from public contracts to secure migrant shelters. https://t.co/VQHQ6sO0Ax
— Remix News & Views (@RMXnews) October 8, 2024To illustrate this point, at least one private investor wanted to purchase the building in the summer of 2024 for €45 million. However, the Israeli owners are going to be earning more than three times as much merely by renting out the office building. Afterward, they could theoretically sell the building and earn an enormous profit on top of the €156 million they already earned from German taxpayers.
The firm that owns the building is “Projekt Soorstraße 80-82 Berlin Grundstücks GmbH,” which is a company in the “opaque corporate network of the Tel Aviv-born investor Amir Dayan, who comes from one of the richest families in Israeli,” according to the NIUS report.
Public schools in the German capital can no longer reimburse teachers for school trips due to budget constraints, but the local government increased its expenditure on migrant housing to €1.3 billion in the summer. https://t.co/zgKa4tZnEt
— Remix News & Views (@RMXnews) October 14, 2024“Since 2008, he has been buying up commercial properties on a large scale, especially in Germany. Dayan’s main company, TLG Immobilien AG, later merged with the real estate group Aroundtown – and so the office complex on Soorstrasse passed into the hands of the Luxembourg-based company.”
The report continues: “Aroundtown, in turn, was founded 20 years ago by the Israeli businessman Yakir Gabay. It is now one of the largest real estate companies in Europe. Gabay followed a similar principle to Dayan. In 2004, the now 58-year-old began investing in Berlin real estate. The group has its formal headquarters in the tax haven of Luxembourg, but its operational headquarters are in Berlin-Tegel at Wittestrasse 30. The subsidiary “Projekt Soorstrasse 80-82 Berlin Grundstücks ApS & Co. eGbR” is also based there.”
The company, which specialized in buying up “problem” properties others did not want, has faced serious losses in recent years, amounting to nearly €2.5 billion in 2024. Its stock price has declined dramatically from 8.70 euros down to 90 cents and currently, it is back up to approximately 3.18.
“In these difficult times, Aroundtown is apparently moving towards a new business model. While the industry is fighting for survival, it is profiting from mass immigration to Germany. The state as tenant promises guaranteed payments of millions,” writes NIUS.
🇩🇪‼️ Germany: Planned Kindergarten Will Become Refugee Container Village
"A daycare center was once planned here – now we have a refugee village," resident Helga Bauer told German newspaper Münchner Merkur.
A site in the Bavarian town of Kirchheim earmarked for a children’s… pic.twitter.com/nKtv5nd00y
— Remix News & Views (@RMXnews) September 18, 2024
