Gritty Reeperbahn faces growing gentrification

At least the name fits Hamburg’s famous red-light district.

Called the Tanzende Türme, or Dancing Towers, because of their curvy design, a €180-million development will house 33,357 square meters of office space alongside a posh, four-star hotel.

On their website, project developer Strabag Real Estate says the high-rise towers set to open this summer reflect Hamburg’s “creativity, modernity and urbanity.” That may be. But they also represent a new highpoint in the ongoing gentrification of St. Pauli, a neighbourhood traditionally known for its punks, prostitutes and blue-collar workers.

Strabag, a Vienna-based company, will locate their German headquarters to the Tanzende Türme. Eight hundred of their employees will begin working there in August. According to the company, several marketing and law firms have expressed interest in renting space in the towers, which have the address Reeperbahn 1.

There goes the neighbourhood?

Large building construction in the city isn’t new. Hamburg is Germany’s second most populous city and one of the wealthiest in Europe. Along with the Church of St. Nicholas and the town hall, construction cranes and scaffolding have become familiar sights on the city’s skyline.

But the changes to St. Pauli, the neighbourhood surrounding the Reeperbahn, have been especially dramatic.

“About 15 years ago the Reeperbahn was kind of this dirty place,” said Kai Ladebeck a Strabag developer working on the project. “Now it has the reputation as a kind of Broadway.”

“There are still prostitutes of course, but in addition there are a lot of entertainment options even for young families – not just for the boys,” he said.

George Harrison once called Hamburg “the naughtiest city in the world” because of the Reeperbahn’s criminality and carnality. But some 50 years after The Beatles lived and played there, it has learned some new tricks.

The strip has been cleaning up its character for the past several decades. In 1986, the family-friendly musical “Cats” opened just off the Reeperbahn and ran for the next 15 years. “Mama Mia!” followed. McDonald’s purchased the street level portion of the venerable Hotel Lausen bordello in the late 1980s. Finer dining and fancier clubs moved into the area. Sex seekers, meanwhile, have increasingly gone online.

To be sure, the neon lights of strip clubs, sex shops and seedy bars still exist on the Reeperbahn. However, many traditional sex clubs have not fared well. The Hotel Luxor, a brothel that had been in operation since 1948, closed in 2008. And of the several erotic cabaret shows that once lit up the street, only the Safari club, where you can pay to see live sex on stage, remains.

Ladebeck said the towers would continue the transformation by bringing more “daylife” to the neighbourhood.

Rising rents

As the neighbourhood’s appeal has broadened, its housing costs have risen. Critics say more affluent apartment seekers are squeezing long-time residents out of the area and that what St. Pauli really needs is not more offices but more affordable housing.

“The Tanzende Türme are a symbol of the city development politics, which does not fit the needs of the people,” said Steffen Jörg, a community activist whose 2009 documentary “Empire St. Pauli” explored the neighbourhood’s ongoing gentrification.

The average rent offer in St. Pauli increased 16.6 percent from 2005 to 2009, according to a report by the Hamburg-Mitte urban planning office. The same study showed rents citywide rose on average four percent over the same time period. (The most recent figures from the Hamburg tenant association show the average rent price in the city for 2011 climbed 5.8 percent over 2009.)

“We need flats for people with low incomes and nowadays the city is just interested in commercial real estate. This is totally besides everything people need in St. Pauli,” Jörg said.

Indeed, despite economic uncertainty demand for office space has remained steady. Hamburg ended 2011 with an eight percent office vacancy rate, according to Colliers International, with just over a million square meters of vacant space in the city. The average price for office rentals increased 11.5 percent from 2010.

Still, the stock of public housing in St. Pauli has not changed much over the past decade. According to a city database, the neighbourhood had 2,027 so-called Sozialwohnungen in 2010, up marginally from. 1,941 in 2000.

As St. Pauli transitions from gritty to glam the fight is likely to continue between residents old and new. In a gesture of goodwill, however, Strabag Real Estate invited their neighbours over for a BBQ every time another floor of the towers was completed.

“We invited everyone to visit,” Ladebeck said. “Including a residence for seniors that live near the project.”