Leipzig is, in many ways, seen as Berlin’s smaller sister. The city was one of Europe’s wealthiest a century ago, buzzing with its numerous trade fairs and thanks to its strong local industry. This is also the reason behind the abundance of period buildings which can be found in most areas of the city, even those which are, nowadays, deprived.
Those very buildings – many of which are still empty – are now starting to attract a young and creative crowd, a phenomenon similar to the one observed in Berlin over the last decade. And, whilst unemployment is still above the national average and crime in certain areas does intimidates the locals, the city is undergoing a renaissance. Low rents combined with a wide cultural offering, a beautiful old town, a friendly population as well as excellent universities and research centres are putting Leipzig back on the international traveller’s and investor’s map.
Part of Bio Saxony, Leipzig is already a growing hotspot for emerging medical and biotechnology. This is also thanks to a leading heart centre, Herzzentrum Leipzig, one of the best in Europe, where many new technologies are tested and evaluated before being launched in Germany and on the Continent.
Now Leipzig is even taking on the larger international hubs for technology startups. A further step forward is the recent creation of a broader technology start-up incubator launched by the leading Handelshochschule Leipzig, the city’s highly regarded Graduate School of Management. SpinLab is supporting a first group of local startups and has been set up – as it is typical for Leipzig – in a large, old, previously empty building – in this case an old Cotton Mill (Leipziger Baumwollspinnerei). The initiative was strongly supported by the local government, and the city is further fostering startups through its portal Startup Leipzig.
Hence the combination of available real estate and land at affordable prices, outstanding universities and research facilities, a pleasant city environment (not too large, not too small, and just over an hour by train from Berlin and twenty minutes drive to its own airport Leipzig-Halle) make the city incredibly attractive to young people. No wonder the population keeps growing – unlike in Germany overall – and Leipzig will, at this pace, soon face housing scarcity after having suffered from a glut for many years – to the extent of having demolished post war buildings to address it.
Still, investors can buy property in Leipzig for less than 1,000 euros a square meter, or even get a whole, empty listed building in need of refurbishment for around 100,000 Euros (i.e. just a couple of hundred Euros per square meter maximum, but excluding the more expensive refurbishment costs). It might sound too good to be true – it’s not, but it won’t last. The offer of property on the market has dwindled in the recent past, and prices soared. And builders and construction companies are overwhelmed with orders, causing a backlog and rising building costs too.
Again, very similar to Berlin, but just a few years behind. And history has shown that, as this stage, and in spite of some bottlenecks, it is not too late to jump on the bandwagon.