The most important results at a glance

Functionality of many German city centres in serious danger

German city centres are currently undergoing a profound structural change that is calling into question the established concepts of the property industry, in particular the previously predominant focus on retail. This change is largely being driven by social, technological and ecological megatrends. Many German city centres have evidently not responded adequately to this change, which is reflected in rising vacancy rates and falling rents for retail space – which entails the risk of downward trends (trading-down effects). This creates considerable pressure to act for a large number of property owners, who are now faced with the challenge of adapting their city centre property portfolios to the changed reality and the needs of citizens. Property owners and the German economy as a whole are threatened with a loss of capital invested in city centres. As a result, owners are faced with the important question of how they can successfully guide their property portfolios through the necessary transformation process. This question is being investigated in two studies as part of the “Transformation of city centres” research project.

A mono-functional concept for the use of city centres that is geared towards the retail trade massively fails to meet the needs of citizens.

The aim of the first study is to understand citizens' needs, wishes and expectations of future city centres. Based on this, recommendations for action are given to transform German city centres into exciting, lively “favourite places” that are also economically viable. To this end, citizens were asked about past changes to city centres, the city centre today and future requirements for city centres as part of a large-scale survey of German households. A total of 1,069 citizens from different social milieus throughout Germany were surveyed.

The results make it clear that German city centres have recently been developed in a way that clearly ignores the needs of the majority of citizens. Essential needs of potential users have not yet been satisfied, which means that there is a need for action in the area of functional design. For example, 55% of citizens would like to see an increase in the attractiveness of the recreational and leisure functions of city centres and 52% each in the quality of public spaces and living spaces. The attractiveness of the retail trade also continues to play an important role as a magnet for citizens for 47% of those surveyed. The study results make it clear that the transformation paths of city centres should be individually designed, as they largely depend on the local framework parameters and those of the respective users (milieus) of the city centre. The milieu-specific requirements of the retail function are particularly clear: While an increase in the attractiveness of retail attracts 47% of all respondents to the city centre more often in the future, this only applies to 37% of the young, well-educated city dwellers, which means that an increase in the attractiveness of retail has less of a magnetic effect on this milieu. Living and (office) work will play an important role in the future mix of functions, making city centres more homogeneously utilised throughout the week and day and thus turning them into lively places. The fact that 39%/26% of the citizens surveyed could in principle imagine working/living in the city centre underlines the immense potential that these functions offer for the revitalisation of city centres, provided that the necessary framework is created.

An effective mix of functions can be optimally planned for every city centre with the help of data; optimisation of retail concepts alone achieves hardly any effect

With regard to the possible offers and activities that underpin the aforementioned functional mix, the study results show that some offers are mandatory components for city centres, while others have the potential to inspire citizens beyond that. In concrete terms, this means that basic services (e.g: Local supply 46%; provision of doctors 45%; schools 33% of respondents) are mandatory criteria (must-be) in city centres for large sections of the population, without which the city centre as a whole is rejected. On the other hand, the individual, the local (e.g. local products: 23 %; local food: 17 %) and the opportunity to experience the individual charm of the city (e.g. hands-on manufactories: 21 %; open-air cinemas: 19 %; local artists: 14 %) can inspire citizens. City centre stakeholders must manage the balancing act between necessary offers and offers that can engage and inspire citizens.

Owners and the public sector have a duty to drive forward the transformation of city centres in order to restore the profitability of property investments

The results of the study show that the attractiveness of city centres needs to be increased both in the mix of property uses (e.g. leisure for 55%, residential for 52% or retail for 47% of respondents) and in the quality of public spaces (e.g. quality of public spaces for 52% or green and open spaces for 52% of respondents). Municipalities need to define a holistic vision and city centre strategy that takes this into account as a guideline for property owners. This gives local authorities the opportunity to initiate needs-based and economically viable city centre development. This fundamental framework must be data-based and closely orientated to the needs of the citizens concerned. The approval processes and regulations must be aligned with the goal of successfully transforming the city centre and, in addition, projects with a lighthouse effect must be created in tandem with the (long-term and strategically oriented) property owners. A symbiotic approach with mutual give and take should be prioritised over going it alone.

The aim of this second study is to understand citizens' preferences regarding the design of the city centre district and the specific mix of uses for city centre properties. The results of the study thus provide an initial basis that can be taken into account in a structured way in the dialogue on city centre development and in future planning procedures. Citizens' preferences express the way in which users would like to see their needs met in city centres. As part of a large-scale household survey with over 1,000 citizens from all social milieus, different citizen preferences were asked about the following sub-areas:

- on the design of the city centre district,

- the allocation of (financial) resources for sustainability in the city centre district,

- on specific space allocations in a mixed-use city centre property

- the allocation of space on the middle floors of the mixed-use city centre property.

The study results clearly show that German citizens prefer a balanced mixed-use approach when it comes to designing city centre districts. Offers for shopping, leisure and living are the most favoured by citizens and are close to each other in terms of importance (shopping: rank 1 with 5.5 % higher preference coverage than living: rank 3). The fact that more urban greenery (rank 1 of the preferred neighbourhood elements), a bicycle/pedestrian-friendly layout (rank 2) and a focus on public transport (rank 3) are the most preferred by citizens in relation to the city centre district opens up points of contact for the public sector. The public space as the flagship of the city centre should be transformed by the municipalities to meet the needs of the identified citizen preferences – multifunctional, greener and pedestrianised. Surprisingly, the citizens' preferences for the design of the city centre district show that there are hardly any significant differences between the incomes of the citizens and milieus, but there are differences with regard to the respective city (size). The design of the neighbourhood is therefore not a question of income. This leads to the realisation for the public sector that needs-based inner-city district development benefits citizens and milieus as a whole.

In addition to ecological and social sustainability, the public sector must also ensure the economic sustainability of city centre concepts.

When considering sustainability in city centre districts, the study results show that all three dimensions (ecology: 34.4 %, social: 33.8 % and economy: 31.8 %) are given almost equal importance, with economic factors such as the promotion of local businesses receiving the second-highest preference from citizens across all dimensions. It is striking that the greening of the neighbourhood is the most important element of ecology for 45% of respondents (ahead of technical solutions at 29%). A supposedly cost-effective design decision by the public sector that economises on the proportion of greenery could therefore fail to meet the needs of citizens and cause macroeconomic disadvantages. In the area of social sustainability, the feeling of safety is the most important aspect for 35% of the citizens surveyed. Social interaction and cohesion is also an important component of social sustainability in the city centre district for those surveyed. The creation of offers for citizens with low incomes and for all generations is strongly favoured by citizens (ranked 2/3 in the social dimension). These preferences provide municipalities and policymakers with valuable insights into the preferences and needs of citizens in order to steer the allocation of resources with regard to sustainability in a way that is acceptable to the majority.

Even large department stores have an economic future if mix-use concepts are taken seriously.

The public's preferences for the allocation of space in city centre properties were examined using the example of a four-storey department stores' with a roof terrace and basement. The results of the study make it clear that the respective mix of uses is strongly characterised by individual local parameters (e.g. income class, milieu). Nevertheless, an important share of the space allocation is still attributed to retail in ground floor locations. The results of the study show that, depending on the surrounding offer, flanking uses of basic services such as local or health care on the ground floor or first floor or catering can offer considerable leverage to meet the preferences of citizens. It is important to note that small-scale, low-cost retail is by far the least favoured on the upper floors. The results of the study thus make it clear that re-utilisation at any price is not recommended. The low bias (2nd/3rd floor with the lowest importance weighting of all floors) of the citizens in favour of using the middle floors offers the potential in the overall concept to link the various uses within the building in a creative way. Gastronomic offerings such as cafés (overall rank 2) and snack bars (overall rank 3), as well as healthcare, are most favoured here. It is particularly striking that the specific design of the middle floors shows hardly any differences between the income classes or milieus. This means that the middle levels harbour the potential to provide the “cement” not only between the main uses, but also between society and urban milieus. It is surprising that, from the citizens' point of view, the uses on the roof terrace are given the highest significance – even before the ground floor locations (ground floor: 16 %; roof terrace: 18 %). A look at the rooftops of German city centres shows that immense potential has so far been missed here.

According to the study results, living and office work form an integral part of the new utilisation mix. According to the study results, residential concepts on the upper floors are the most favoured and office work the second most favoured. In the context of the first study, it is also interesting to note that the desire of the citizens surveyed to work and live in the city centre increases significantly after they have drawn up their “desired subsequent use mix”. Approval ratings increase from 39% to 62% for living and from 57% to 64% for working (approval in the first study to approval in the second study). This makes it clear that needs-based city centres have immense potential to mitigate or even reverse the current rural exodus in the residential sector. As already shown in the first study, living and working play an important role in the continuous revitalisation of city centres.

In order for preference-oriented and needs-based city centre properties to contribute to the revitalisation of the city centre, an overarching strategic orientation of the municipalities and their planning instruments and specific approval processes is necessary. It is advisable to actively promote long-term and strategically oriented property owners whose development concepts optimally meet the needs of citizens by utilising synergies/coupling effects. In concrete terms, fast, simple authorisation procedures and flexibility in implementation are necessary for this to succeed. To this end, it is expedient to institutionalise the strategic orientation towards the needs of citizens and integration in the city centre as part of the approval process.

Research project by TU Darmstadt together with JC Real Estate, CBRE, EBS University of Business and Law, IFH Cologne and P&C Düsseldorf

The high-calibre research initiative was set up with the aim of using data-based studies to develop scientific guidelines for sustainable city centre use

Together with CBRE Deutschland GmbH, EBS University of Business and Law, IFH Köln GmbH, P&C Düsseldorf KG and the Technical University of Darmstadt, JC Real Estate is initiating a Germany-wide research project on the transformation of city centres. The aim is to identify various causes, effects and success factors for sustainable city centre development.

JC Real Estate
IFH Köln
IFH Köln

Questions? Please contact us!

  Name Working area(s) Contact
Prof. Dr. Andreas Pfnür
+49 6151 16-24510
S1|02 31
Jonas Rau M.Sc.
+49 6151 16-24512
S1|02 31
Fabian Lachenmayer M.Sc.
+49 6151 16-24513
S1|02 38