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Berlin's planning authorities are increasingly treating stays beyond six weeks as residential use rather than temporary accommodation, according to planning lawyer Mathias Hellriegel, speaking at Heuer Dialog's Jahreskongress Temporäres Wohnen in Berlin. The distinction may appear technical. In practice, it influences planning approvals, operational flexibility and, increasingly, financing costs.
The issue sits at the heart of a growing debate within Germany's serviced-living sector. Developers, operators and lenders argue that uncertainty over where "Wohnen" (residential use) ends and "Beherbergung" (commercial accommodation) begins is making projects harder to structure and finance, particularly in cities such as Berlin where the interpretation has become progressively more restrictive.
Alexander Schöneich of pbb Deutsche Pfandbriefbank explained that lenders view commercially classified accommodation as inherently more volatile than residential assets, since occupancy can fluctuate as sharply as in a hotel. The practical consequence is a pricing and equity gap wide enough to materially change a project's economics, even between two otherwise identical buildings — one classified residential, the other commercial. Get the classification wrong, or have it reclassified mid-project, and the numbers can shift substantially.
Hellriegel illustrated the stakes with two live examples. He is currently preparing litigation over a stalled conversion of vacant upper floors in a shopping centre, where residential use is not zoning-permitted at the site at all, meaning a hospitality concept is the only legally available option. Yet Berlin's authority wants to cap stays at six weeks despite every other feature of the concept — no kitchenettes, daily-rate availability and hotel-style services — pointing towards commercial accommodation.
Separately, he described an investor willing to complete the unfinished Monarch Tower, a long-stalled Berlin landmark, using a serviced-apartment concept requiring day-rate flexibility. According to Hellriegel, the proposal was rejected specifically because of that flexibility requirement, leaving the building unfinished.
Berlin is not unique in grappling with the issue. Munich's threshold runs as low as four weeks, according to Marc Pielke of operator Homaris, while Stuttgart has imposed a two-month cap in building permits for years. The result is a patchwork of interpretations that leaves investors and operators navigating different definitions of what constitutes residential occupation from one city to the next.
When planning law becomes financing risk
Klaus Franken of Catella Project Management offered a pointed, if brief, dose of industry self-criticism. Much of the current regulatory tightening, he argued, is a response to the sector's own past habit of pushing grey areas in planning law to their limits. The industry should not be entirely surprised that regulators have become more cautious.
The sharpest framing of what is ultimately at stake came from Henrik von Bothmer of Union Investment, speaking from the floor. The binding constraint on the sector, he argued, is not demand. Demand remains strong across a wide range of living concepts. The problem is whether projects can generate returns that justify today's construction costs.
"Capital is not social," he said, arguing that policymakers cannot expect private investors to deliver social outcomes if the underlying economics no longer work. Where he saw genuine scope for improving affordability was not through additional regulation, but through deregulation. He pointed to Hamburg's efforts to simplify building requirements, which have reportedly reduced costs by several hundred euros per square metre, as a more effective lever than further subsidy programmes.
Germany's debate over what counts as "living" is no longer a planning footnote — it is fast becoming one of the most consequential variables in how a serviced housing project gets financed, and recent developments suggest the definition is becoming progressively narrower.