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City of Cologne: 50 million euros for controversial Kaufhof rental agreement!
The city of Cologne is being criticized because of a controversial rental agreement for the Kaufhof headquarters, which causes high costs.
City of Cologne: 50 million euros for controversial Kaufhof rental agreement!
The city of Cologne is facing financial challenges surrounding the rental agreement for the former Kaufhof headquarters on Leonhard-Tietz-Straße. At a time when real estate prices in the city are rising sharply, renting the property has become more expensive than initially planned. The majority of the city council has so far voted against releasing 50 million euros for the renovation, and politicians are critical of the additional costs, which will now total 300 million euros by 2050, as ksta.de reports.
On July 3rd, the city administration would like to make another attempt to get approval from the city council. The discussions are no coincidence, as there are differences within the city's building industry over the rental agreement, the original aim of which was to serve as an interim location for the city center fire station. However, this project was withdrawn due to the high costs.
Rising costs and new uses
The city of Cologne should now make a special payment of 50 million euros for the renovation work. The rental agreement, which was originally concluded on June 9, 2022 based on a council resolution, also provides for an extension of five years until December 31, 2050. The total area of the property is around 45,000 square meters, and offices for various offices are planned, including the cultural department and the health department. However, the originally planned objects, such as the interim fire station and the reading room, have now been deleted, as rundschau-online.de explains.
The total costs for the renovation are now estimated at around 77 million euros, which means an increase of 50 million euros compared to the original budget. The reasons for these cost increases are extensive replanning, time delays and loss of rent. For example, there is an increase in additional costs because 20% of the additional costs result from loss of rent and 10% due to increased requirements for security technology and IT.
Political reactions and concerns
The reactions in politics are mixed. The Greens and the CDU are demanding a simultaneous decision on the interim at Löwengasse and the Kaufhof headquarters, while the SPD and the Left are demanding more transparency in the processes. Recent estimates suggest that annual rental payments will rise to around 12.3 million euros from the end of 2026. This represents a 156 percent increase compared to previous rent payments, further increasing the financial burden on the city.
Although the market rental price in the city center is 33.50 euros per square meter, a price of 19.70 euros per square meter was agreed for the Kaufhof headquarters. However, this rental price is expected to rise to 24.30 euros per square meter due to the additional costs. The city must carefully weigh up its interests and ensure that the planned usage concept actually offers added value for its citizens.
In summary, the case surrounding the Kaufhof headquarters shows how important transparent and careful budget planning is. The coming political decisions will be crucial to how the city deals with this financial challenge and whether it can successfully cope with the ongoing price increase on the Cologne real estate market. In this dynamic environment, in which Cologne's population is expected to grow to over 1.2 million by 2040, such challenges are very important, as is the real estate market itself.