Administrative offices move into former Kaufhof
City Council decides to relocate two administrative centres of the City of Chemnitz
Offices from the Moritzhof and the Alte Post move into the former Galeria department stores'
In a non-public meeting on 29 January 2025, the Chemnitz City Council passed a resolution in principle instructing the City of Chemnitz to move out of the Moritzhof and Alte Post administrative sites. Accordingly, the City of Chemnitz is to conclude a rental agreement with the Krieger Group so that the offices from these two properties can move into the former Galeria Kaufhof building. The lease is to have a term of 15 years with a five-year extension option.
The leases for both the Moritzhof and Alte Post administrative centres expire in 2028. The City of Chemnitz therefore published a rental application last summer, to which several applicants responded.
In several non-public meetings, the city councillors discussed the issue and the alternatives proposed by the City of Chemnitz.
The concept presented for the former department stores' on Neumarkt offers a modern and sustainable administrative location on the upper floors, which at the same time brings a range of municipal services even closer to the city centre. The two lower floors will house catering and retail outlets. This will give the city's most central building a multifunctional use and a representative character with holistic utilisation of all floors. A vacancy in a prominent location, which would have had a considerable impact on the cityscape due to the complexity and size of the building, could thus be averted.
The new location in the immediate vicinity of the town hall also improves networking within the city of Chemnitz. Distances between the specialist departments are reduced compared to the current Moritzhof location. With the central bus stop in the immediate vicinity, there is an ideal connection to public transport for both visitors and employees. At the same time, this central location can ensure that users of the building use the city centre for other, diverse occasions.
Questions and answers
Why does the administration want to move the social welfare office, youth welfare office, registry office and the department of finance, personnel and IT into the Kaufhof and pay 6 million euros more for it?
Why does the administration want to move the social welfare office, youth welfare office, registry office and the department of finance, personnel and IT into the Kaufhof and pay 6 million euros more for it?
The 6 million euro additional costs relate to the rental period of 15 years. This means that the city of Chemnitz will have to pay 400,000 euros more in rent per year than with the cheapest provider. However, this only applies to the pure rental price.
There are other important aspects that were taken into account in the city councillors' decision: for example, the Kaufhof building will be of particularly high energy quality after the conversion, meeting the KfW 55 efficiency building standard.
This will result in significantly lower ancillary costs than existing buildings, for example, which cannot fulfil KfW efficiency class 55. The annual heating costs for the Kaufhof building are forecast to be around 55,000 euros. In comparison, the city of Chemnitz pays around 181,000 euros per year for heating in the current Moritzhof rental property. In addition, due to the enormous refurbishment backlog (the building is 28 years old), numerous other extensive upgrades would be necessary in Moritzhof, for example, which would then also be passed on to the rent.
The two decisions - the rental agreement on the one hand and the consolidation measures on the other - have nothing to do with each other. As an employer, the City of Chemnitz must always provide its employees with workplaces. These costs are included in the current budget, as the city is also currently making rental payments. Incidentally, rental payments for the Kaufhof will be due for the first time in 2028. There will be no double expenditure.
Irrespective of this, almost all cities in Germany are affected by large financial holes in their budgets because the federal and state governments are handing over more and more services to local authorities but not providing the corresponding funds. This is why Chemnitz is now also being forced to make serious savings efforts in order to remain capable of acting on its own.
The rental agreements in the Moritzhof and the Alte Post are legally binding and expire on 31 July 2028 and can no longer be extended. A new invitation to tender therefore had to be issued, in which several bids were submitted. These included the owner of the Moritzhof.
When the City of Chemnitz and its offices move out of the Moritzhof, it is the responsibility of the owner to decide how the premises can be used and let. The Technical City Hall's move out of the building in Annaberger Straße and the current re-letting of the property shows that office buildings can be re-utilised.
The decision was deliberately based on several criteria (not just price), as this is an important strategic decision for the city. The bids were evaluated according to four overarching criteria with numerous sub-parameters.
- The economic efficiency criterion accounted for 40 per cent of the evaluation and includes not only the pure rental price, but also one-off and other costs as well as special services provided by the bidders.
- The criterion of implementation of municipal requirements relates to the points of spatial planning, implementation of the requirements for a citizen service for the next 20 years, the required energy level (and thus the expected long-term ancillary costs) and citizen friendliness. It accounted for 30 per cent of the overall score.
- The third criterion, implementation of the offers, accounted for 20 per cent of the evaluation and considers how realistically the offer can be implemented and how little the employees and citizens are restricted by the implementation.
- The last criterion reflects the urban development assessment and accounted for 10 per cent of the overall score. It considers the location of the property, public transport connections and the avoidance of vacancies. Due to its location, it is very well connected to public transport and the multi-storey car park offers perfect opportunities for accessibility by car. In addition, the proximity to the town hall, Bürgerhaus am Wall and technical town hall shortens the distances between the administrative offices.
The city council's committees have been discussing and debating the options after the lease expires at Moritzhof since 2021. One of the options discussed was a new building.
Like all other draft resolutions, the current draft resolution submitted to the City Council was also discussed in advance by the relevant committees. All of the information and data required for the decision-making process was made available to the city councillors in a transparent and comprehensive manner. Access to the files was also granted. The changes requested by the committees were incorporated into the administration's draft resolution and submitted to the parliamentary groups prior to the city council meeting.
As the various offers involved commercially sensitive data from providers, the draft resolution was always discussed and decided on in private. If the exact figures from the offers were to be made public, potential landlords could possibly suffer economic disadvantages. This is required by law. For this reason, the specific offer information must not be made public for everyone.
The closure of Galeria Karstadt Kaufhof threatens to leave a prominent building in the city centre of Chemnitz vacant. The planned combination of retail and gastronomy on the lower two floors and the offices moving into floors 2 to 4 will prevent this vacancy and ensure that the building is used in a multifunctional and holistic way in future.
The quick perspective after the end of Galeria Kaufhof is an important signal for other tenants and shops in the city centre, as retail and gastronomy in particular are dependent on a high visitor frequency.