The once bustling German department store “Ka-de-Wa” in West Berlin is now facing tough times. Despite its luxurious appearance, the store is struggling to survive due to a combination of specific business reasons and the slump in the commercial real estate market. Cigna, the Austrian real estate company that has owned it for over a decade, filed for bankruptcy earlier this year. Some vendors that worked with them didn’t receive their payments for months and some returned their goods, ending their contracts with the company.
On an average day, about 50,000 shoppers visit the store, but at a second look, signs of trouble become more apparent. Fancy films block access to most products in the design and home department on the fifth floor, for example. Empty shelves and bare walls peek through the men’s and women’s fashion floors where some vendors have pulled merchandise. Even chocolate shops on the sixth floor ask for payment only by credit card due to bankruptcy concerns.
The fate of the department store is uncertain as Cigna’s bankruptcy stems from a combination of specific business reasons against the backdrop of a struggling economy in Germany. The latest data published this month shows that Germany contracted by 0.5% in 2023, with debt piling up and deficits increasing as politicians struggle to find solutions to economic instability. Meanwhile politically, extremist parties are gaining strength in polls as they have not been since World War II.
This year’s regional elections and European Parliament elections may translate public unrest into radical political change as far-right parties such as “Alternative to Germany” party and “Sarah Wagenknecht Alliance”, which split from “Di Linka” party together win 25% of vote according to latest polls. The troubles of “Ka-de-Wa” reflect not only its own struggles but also those of Germany: it is hardly sold through online platforms (it only started doing so in 2020), and it is struggling to survive after Corona years where online trade has surged and non-German economies have already recovered. According to manager of business activity in it there is a future for “ca-de-va”, just not under current framework with normal rent paid he stated while speaking to media outlets.”