An expert commission is to clarify whether and how the Berlin referendum on the socialization of large housing corporations could be implemented. Also the initiative "Deutsche Wohnen& Co. expropriate" may have a say – but not too much, says Construction Senator Andreas Geisel (SPD).
At its closed-door meeting in mid-January, the new red-green-red Berlin Senate decided, among other things, to launch an expert commission, if possible within the first 100 days of government, to examine whether the successful referendum of the initiative "Deutsche Wohnen& Co. expropriate" could be implemented constitutionally. But the first thing to be negotiated is how much room the expropriation initiative should get in the commission.
The initiators of the referendum on the expropriation of large real estate companies want to provide the majority of the commission members. Berlin’s building senator Andreas Geisel (SPD) has rejected this demand: The expert commission agreed in the coalition agreement is not a decision-making body, said Geisel. "It’s also not a place for political discussions or majorities or anything like that."
Sword of Damocles Constitutional Court: Expert Commission to be "watertight work
Rather, the commission should provide legal advice to the Senate on the question of whether or not a law on the expropriation of housing companies is constitutional, said the senator of construction. "And as a second stage, it should answer the question: Does it make sense in terms of housing or not?"
It has one year time for it, then the senate about the results of the experts will discuss and to the House of Representatives a decision present. It’s about arguments and expertise, and about convincing oneself that the work is being done seriously. Things are either constitutional or not. "After the rent cap, we must in no way head for another defeat at the Constitutional Court", according to Geisel.
In the referendum parallel to the elections to the Berlin House of Representatives on 26.9.In 2021, around 59 percent of the electorate had voted for the expropriation of large housing companies in Berlin. Accordingly, the initiative now demands to be allowed to provide 59 percent of the commission members. It assumes that in the committee no more at all over whether, but only over the How of an expropriation law one discusses. From the point of view of parts of the Senate, however, it is not clear whether such a law can be implemented constitutionally.
Lawyer: Berlin constitution does not permit socialization
The left in the citizen of Berlin House of Representatives had already at the beginning of March 2021 a debate draft for a "law for the transfer of property of housing enterprises into common property" presented. In May, "Deutsche Wohnen& Co. expropriate a draft of its own for a "Law on the Transfer of Residential Real Estate to Common Ownership (Vergesellschaftungsgesetz – VergG)" before.
The initiative refers to Article 15 of the German Basic Law (GG), according to which "land, natural resources and means of production" must be owned by the public could be transferred to public ownership. According to this idea, it is not the companies themselves that are to be socialized, but their land and buildings used for residential purposes.
New owner of the real estates is to become then an institution of the public right ("common property living") and the housing stocks may never again be privatized. State-owned, non-profit companies and the cooperatives are to be exempt from the regulations, as explained by lawyer Sebastian Schneider, who was instrumental in drafting the bill.
Again, Benedikt Wolfers, lawyer and partner in the Berlin law firm Posser Spieth Wolfers, writes& Partners, in a guest article in the Berlin "Tagesspiegel, that the project would already fail because of the state constitution, which does not permit a socialization at all.
Dispute over compensation: expropriation would cost Berlin billions
About a dozen Berlin companies with a total of more than 240 properties would be affected by a socialization," said Geisel.000 rental apartments. The listed Deutsche Wohnen Group alone, which is the target of the initiative, had a portfolio of around 116 properties.000 apartments in the Berlin area. Meanwhile the company was taken over by the bigger competitor Vonovia.
According to an estimate by the old Senate, compensation would cost Berlin, which is already heavily in debt, between 28.8 and 36 billion euros. "Deutsche Wohnen& Co. expropriate" expects to receive a total of around ten billion euros.
The activists do not want to compensate the real estate companies with money, but "compensation bonds" – Issue securities with the nominal value of the compensation amount. The bonds would be repaid over a period of 40 years. The whole thing is to be refinanced from rental income. The initiative is based on a comparatively low net rent of 4.04 euros per square meter.
"Deutsche Wohnen& Co. expropriation": the path to a referendum
The citizens of Berlin were in favor of the alliance "Deutsche Wohnen& Co. expropriate" from the beginning by a majority well weighed. Since up to 25.6.2021 – within the specified period since the starting signal for the second phase of the referendum on 26.2.2021 – sufficient (seven percent of those eligible to vote in the Berlin House of Representatives) Berliners had cast a valid vote, it came to the referendum, which was held on 26.9.2021 like an election took place.
The then red-red-green Berlin Senate supported the referendum in a statement on 20 May.7.2021 in principle the concern of the initiators to increase the portion of public welfare-oriented housing owners, referred however to the fact that an conversion could be achieved only by a politically and legally controversial Vergesellschaftungsgesetz. The Left Party had even helped collect signatures. The SPD, with the exception of the Jusos, has always been against "expropriation" from – as well as parts of the Green Party and the opposition parties.
On 15.10.In 2021, the new coalition of the SPD, the Greens and the Left decided in the exploratory talks for the formation of a government to set up the expert commission, which is to examine the possibilities and conditions for implementation within one year.