No-frills living? budget retailer Aldi launches thousands of new supermarket rental flats above its stores in Berlin

The German grocer is investing in new-build homes above its stores in Berlin.

Budget supermarket Aldi has announced plans to build more than 2,000 rental apartments above its stores.

The mixed-use real estate is planned to be rolled out in at least 30 locations in Berlin at first, in response to rapid population growth and increased demand for affordable housing in the German capital.

Aldi are launching the scheme with 200 apartments in two east Berlin locations: the working class-turned-hipster district of Neukölln and Lichtenberg, home to the former headquarters of the Stasi.

FOLLOWING THE LONDON MODEL

Aldi is not the first supermarket to invest in on-site housing. Tesco has already built homes in Woolwich and Streatham and is building another development in Hackney, where a small store will replace a bigger one to free up land for more than 300 “own-brand” homes.

Sainsbury has new supermarkets with rooftop gardens next to new-build homes in Fulham and Nine Elms and are working on plans next to New Cross Gate station, while Morrisons is set to build 700 homes at its Chalk Farm site.

A SUPERMARKET ON THE DOORSTEP
The homes are due to be ready to move into by mid-2019 and will be rented for between 6.5 and 10 euros per square metre, according to an article in Berliner Morgenpost.

This is around average for the area, with German property website Immobilienscout24.de calculating the average rent near Neukölln station as 8.8 euros per square metre in 2016.

Rental laws introduced in Berlin in 2015 forbid landlords from charging more than 10 per cent more than the average rent per square metre in a neighbourhood.

Despite this, rents in Berlin, especially East Berlin, have risen as much as 10 per cent each year due to high immigration and a lack of new house building.

City officials say Berlin will need 194,000 new homes by 2030 to cope with a projected population increase from 3.5 million to 4 million.

Another 15 locations for supermarket/apartments in the city are currently in planning with Aldi working closely with Berlin’s state government.

The retailer hopes to support its roll out of larger stores offering a wider range of products with demand for Aldi groceries higher if there are people living on site.

Jörg Michalek, Managing Director of ALDI Immobilienverwaltung GmbH & Co. KG called the combination of Aldi markets and connected living space a “future-oriented solution”.

No-frills flats: Aldi is investing in new homes to rent above its stores

Neukölln residents living near one of the first sites had an ambivalent response to the scheme.

One local, who asked not to be named, said: “Aldi Nord has a longstanding reputation for no-frills shopping and I doubt its foray into the property market will offer anything different.”