Cologne's Liebigquartier: Right of first refusal is slowing down investors!

Cologne's Liebigquartier: Right of first refusal is slowing down investors!

In the heart of Cologne, planning for the Liebigquartier is in full swing. A colorful mix of residential areas, commercial areas and spacious green areas will be created here. The city administration has already tackled this long-term challenge in 2022 with a spatial development concept (REK) that sets clear guidelines for the use of areas in the 130-hectare area between Inner Kanalstrasse, A 57, the park belt and the railway embankment. But that's not all: In order to support the establishment of forms of creative industries, the city is planning to secure a right of first refusal for properties that are to be sold.

As the Cologne City Gazette reported, the proposal for the development of a corresponding statute has already been submitted to the Ehrenfeld district council. The goal? The implementation of the REK goals through the targeted use of the right of first refusal in the interest of the general public. An example could be the former slaughterhouse site, where commercial uses and socio-cultural facilities should go hand in hand.

Right of first refusal as a strategic tool

The right of first refusal is seen as the key to being proactive in urban development. Loud IFH Cologne enables municipalities to purchase land or real estate as a priority and thus to control development processes in accordance with the needs of the population. In other cities, such as Hanau, the right of first refusal was successfully used to revitalize inner city areas and reduce vacancies. It is clear that Cologne can also benefit from this opportunity.

The legal requirements for allowing the right of first refusal have already been approved by the Council - however, this instrument can only be used after a purchase contract has been concluded. For the city, this means that it only has to pay the market value and not the price specified in the contract. There are important restrictions: The right of first refusal is not applicable to condominiums or leaseholds and must always be exercised in the interest of the general public.

Challenges at the federal level

Nonetheless, there are higher-level challenges that impact the use of preemption. Again German Cities Association As noted, the right of first refusal is not strengthened in the current draft amendment to the Building Code, which is particularly worrying in times of overheated real estate markets. The federal government has not yet taken any measures to improve the legal framework that would enable more efficient application of the right of pre-emption. This could be a problem for many cities that find that private interests are pitted against the needs of the public.

A good overview is needed in the city and beyond in order to actively address the challenges of urban development. This is the only way to achieve harmonious and sustainable development in the Liebigquartier and beyond.