The first reports had already leaked over the weekend, now it’s official: The KaDeWe Group has filed for insolvency. The three locations will initially continue to operate. Meanwhile, Senator for Economic Affairs Giffey remains optimistic.
- The KaDeWe Group is insolvent – the district court confirms receipt of the insolvency application
- 1,700 employees are affected in the three locations Berlin, Munich and Hamburg
- Company refers to “exorbitantly high rents”
- The economic senator and the trade association believe in preserving the Berlin location
The KaDeWe Group around the Berlin luxury department store of the same name has filed for insolvency. The Berlin Charlottenburg District Court has already approved the application and appointed lawyer Christian Graf Brockdorff as provisional administrator, the company announced on Monday. The KaDeWe Group now wants to secure its future through the self-administration process; the department stores will remain open, it was said.
The background to the application is “exorbitantly high rents” for the department store properties. These made “sustainably profitable economic activity almost impossible”. That should change. “I am very confident that together with the management we will be able to continue the group successfully,” said administrator Brockdorff.
In addition to the Berlin KaDeWe, the Oberpollinger (Munich) and Alsterhaus (Hamburg) locations are affected by the insolvency application. Companies that have good prospects of continuing business operations usually apply for insolvency under self-administration rather than with the help of an insolvency administrator. It is a variant of insolvency law that aims to restructure a company instead of winding it up.
Signa construction projects on Hermannplatz and Kurfürstendamm are insolvent
Signa problems drag KaDeWe into the vortex
The troubled Signa Group of Tyrolean investor Rene Benko holds 49.9 percent of the shares in the KaDeWe Group, while the Central Group from Thailand, which specializes in trading, holds 50.1 percent. According to their own statements, the three luxury department stores employ around 1,700 people.
According to the information, the department store properties in prime city center locations belong to Signa. The German empire is also part of Benko’s crumbling empire Department store giant Galeria, which had also filed for bankruptcy. Signa Retail announced at the end of November that it would wind up its business in an orderly manner. Galeria Karstadt Kaufhof filed for insolvency proceedings three weeks ago.
The KaDeWe remained closed on – in the rest of Berlin – the Sunday that was open for shopping. Berliners and tourists who enjoyed shopping stood in front of closed doors. It is not clear whether there is a connection with the bankruptcy filing. On Saturday, KaDeWe had already left inquiries open as to whether it would take part in the shopping Sunday on the occasion of Green Week. At first it had Business magazine “Capital” reported on preparations for filing for insolvency.
Real estate units of the Signa Group insolvent
The most important real estate division of the ailing Signa Group is now insolvent. The affected subsidiary Signa Prime includes commercial properties in top locations, including Berlin’s KaDeWe.more
Senator for Economic Affairs Giffey is confident about the future
It is not yet possible to predict what impact the insolvency application will have. Berlin’s Senator for Economic Affairs Franziska Giffey (SPD) was optimistic for the time being. “It’s very clear to us: The KaDeWe is a department store icon. It is the most famous department store in Germany. It is an absolute flagship and also a landmark of our city,” she told rbb on the sidelines SPD parliamentary group meeting in Leipzig.
The senator referred to ongoing discussions at various levels, which, however, are confidential. “It’s of course about the rental conditions, it’s about the question of shareholder ownership,” said Giffey. It is known that the Thai Central Group already holds around 50 percent of KaDeWe “and that there might also be a willingness to get in with more.” According to Giffey, the Central Group values the KaDeWe as a “special location”.
The Senate will get involved wherever possible. Everything will be done to “ensure the preservation of the KaDeWe and to exploit the possibilities for this.” The Senator for Economic Affairs also referred to the over 100-year, eventful history of the luxury department store: “During this time, the parent company has changed seven times.”
Insolvency administrator: Galeria branches secured until late summer
Just a few days ago, the department store chain Galeria Karstadt Kaufhof filed for its third insolvency application in just a few years, and now the employees are at least gaining a little time: the money is enough for a few more months.more
Trade association has little concern about jobs
The employees who came out of the building on Sunday did not want to speak openly to rbb. Some seemed to have only found out about the impending bankruptcy filing through the media.
The managing director of the Berlin-Brandenburg trade association, Nils Busch-Petersen, does not initially see any acute threat to jobs. “If I were employed in retail in Berlin, this would certainly be one of the jobs I would be least worried about,” Busch-Petersen told rbb.
The trade association does not see the reason for the impending bankruptcy filing in KaDeWe’s possible red numbers. On the contrary: According to the industry association, the department store is doing above average. You may just want to use a bankruptcy filing to reposition yourself.
Broadcast: rbb24 Inforadio, January 28, 2024, 6 a.m
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