Last spring, Bertelsmann backed off from its grand New York real estate plans, announcing it would sell all or part of its two midtown buildings. But as the Trump-like venture lost steam here, the firm was moving forward in its native Germany.
In Berlin, the company is going ahead with plans to rebuild the landmark Stadtkommandantur, the seat of municipal power in the Prussian empire that was mostly destroyed during WWII. The building will have only a limited operational use for Bertelsmann and instead will serve as a kind of showpiece—hosting parties, government officials, visiting executives and media. It is set to open in November.
"We want to use it for a lot of different things. We want to host important officials. We want Random House authors to be hosted there. This is our public face in the capital," said Oliver Fahlbusch, a company spokesperson.
At a reported cost of more than $20 million, it is an expensive face. It is the kind of project that, like the Times Square idea, is reminiscent of the flusher times of 1999, which is in fact when the firm won a bidding competition hosted by the city. Although the project was launched as a joint effort by the Bertelsmann Foundation and Bertelsmann A.G., it feels more Thomas Middelhoff than Reinhard Mohn.
In some ways, the address it is being built at is even more prominent—though less expensive—than the midtown U.S. sites. It will reside at 1 Unter den Linden, the wide boulevard that is the centerpiece of the new, spiffed-up Berlin, just a few blocks from the famous Alexanderplatz and up the street from popular sites like the City Opera and the Bebelplatz. With its retro-historic facade of mauve-colored stone and a futuristic section of rounded glass, the building, which takes up a good chunk of a city block, is particularly ambitious given a city and a media economy that are foundering and the company's own mixed results in the first half of 2003. Indeed, when it announced its design for the project, the company faced some protests from civic groups who said it was too glamorous.
But a combination of political considerations—the government looks favorably on companies willing to spend their own money on Berlin restoration projects—and a desire for a higher profile in Germany seems to have pushed the project forward. While some members of the government and media make the trek out to Bertelsmann headquarters in Gutersloh, the remote location of the main office is generally thought of as a liability. "It's hard to get journalists and politicians to come to Gutersloh," notes one German book insider. "They have to spend the night."
Some observers say that the Stadtkommandantur is a legacy project and wonder how much it will actually figure into the company's plans. "This has a lot to do with the heritage of Bertelsmann," said one company observer. "It was started years ago when the economy was different," adding, "It's not really clear how much they need this. You don't really need to be in Berlin to do business." The company maintains it will serve an important role as an outpost, but agrees that the company's allegiance remains with the town many journalists like to call sleepy. "The one thing we need to make clear is that it's not the beginning of a move out of Gutersloh," said Fahlbusch. "We're here and we're staying here."