Annual Report 2012 - ORCO Germany

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Economic, demographic and real estate environment 2
For the first time since 2010, the economy is growing at an above average pace. Berlin´s economy showed a
solid growth trend slightly above the German average. According to DTZ research, the unemployment rate
decreased from 12.3% by year end 2011 to 11.6% by end of 2012 with a slight increase expected in a short term
run for 2013.
There has been a stable upward trend in terms of population, economic output and employment for a number of
years. This canbe attributed to the city’s varied industry structure,which has a promising future, as wellas its
attractiveness for residents and visitorsand its growing importance as a German and European center for politics,
culture, scienceand tourism. Although Berlin still has the highest unemploymentrate of all German federal states,
it is making progress. In the period from March2011 to March 2012, the number of employed persons increased
by 3.4%, a higher rate than elsewhere in the country
New construction activity – which remains modest – is also concentrated in the city center.Friedrichshain-
Kreuzberg, Pankow and Mitte saw the largest number of building permits in 2011, while Spandau, Neukölln and
Marzahn-Hellersdorf brought up the rear. As building lots in the city center are becoming increasingly scarce,
however, new construction is likely to focus increasingly on areas outside the city center over the coming years.
The number of employees in Berlin and the Metropolitan Region is also increasing. One main driver is strong
private and international large-scale capital flow into the city, almost exclusively in real estate and in the Internet
start-up industry, as shown by the large investment from Google and Groupon.
This economic boom has demographic and employment effect. From 2006-2011, the number of employees
increased from 2006 to 2011 by almost 17% according to Thomas Daily Berlin report, which is the largest
increase among all A-sites Germany Once more, Berlin is more populous than in the 1990s. An estimated 30-
35,000 people are moving to Berlin every year.
Also, the affluent suburbs within the outer ring road have continuously grown in the last two decades and
population growth continues. There is a trend of re-urbanization following the previous de-urbanization. Berlin still
attracts the surrounding region. The population growth of the Berlin city centre is the result of national or
international immigration.
However, the city still has enormous land reserves. According to national statistics, the city has 100km² of land
plus 160 km ² of forest; therefore the price of land in comparison to other German cities remains low. Berlin
infrastructure was originally designed for around 6-7 million residents and now counts for only half of this number
of residents. No other European city has such urban opportunities, with two abandoned city airports and such a
good infrastructure.
Annual Management Report – ORCO GERMANY
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