In April, a party was held at Berlin’s legendary department store, KaDeWe, to celebrate the 100th birthday of a place that has in many ways been a focal point in Germany’s turbulent 20th century history. The store, which opened to the public in 1907, has hosted a series of celebrations this year to mark its centennial and the largest was held in April, when KaDeWe turned the store, the second largest in continental Europe, into a throwback to the roaring ’20s.
But what the revelers probably didn’t know was that the historic building was set to change hands once again. KaDeWe is the flagship of a €5.5 billion ($7.2 billion) property portfolio owned by a joint venture of the German retail and leisure group Karstadtquelle and Goldman Sachs’ Whitehall fund. Karstadtquelle has hired NM Rothschild and Goldman Sachs to sell off its real estate assets ahead of a possible London listing next year.
The company’s portfolio of German department stores, which Karstadtquelle acquired in 1994 when it bought the Hertie Company, was partially sold to Whitehall through a joint venture in March 2006. By selling 51 percent of the portfolio to Goldman, Karstadtquelle realized €3.7 billion to pay down its debt.
Founded by Adolf Jandorf, KaDeWe—full name Kaufhause des Westens, “department store of the West”—has seen its fair share of history. Built in 1905 by the architect Emil Schaudt, the store was bought by Hermann Tietz in 1927 and integrated into the Hertie Department Store Corporation. The management went through a purge in 1933 when a group of banks forced the sale of Hertie and installed an “Aryan” managing director.
During World War II, an American airplane crashed into the building, nearly destroying it. The building’s restoration later became a symbol of a new beginning for post-war Germany and 180,000 Berliners turned out for the reopening of the first two floors in 1950. As more floors were steadily restored, the store became a symbol of the regained economic power of Germany, as well as the prosperity of West Berlin relative to its eastern counterpart.
With over 60,000 square meters of floor space and more than 380,000 products for sale, the store now attracts up to 50,000 visitors every day and has also become a major tourist destination. With the addition in the early 1990s of the sixth and seventh floors, which are completely devoted to food, KaDeWe and its sister stores will likely see strong interest from UK property investors eager to access the recovering German retail market. Indeed, with its high-profile crown jewel, the portfolio is likely to attract many suitors from throughout Europe.