I suspect that the rapidly rising real estate prices in Berlin will make most of them infeasible soon, but so far Berlin is still relatively cheap compared to other cities of similar political and cultural capital.
They may also be grandfathered into affordable leases and paying less rent than you imagine, although not sure that works as well for commercial leases as it does for residential.
Surely you can't buy a £1M property in £20 notes right?
In Kansas City there are some highly gentrified city neighborhoods but then a block or two away a bunch of old warehouse-type factory buildings for rent.
Especially West Berlin still has quite a few places that pre-date the fall of the wall 30 years ago. Lately, Charlottenburg (a big neighborhood in the West) has been gentrifying rapidly. So, you get this weird contrast between these old places and very new & trendy things opening right next to them.
You see the same dynamic in East Berlin though large parts of that have been gentrified by now. I live close to the wall memorial on the East side and most of the old shops and restaurants in my area have disappeared over the last 12 years. Mostly the reason is that the business owners hit retirement age and scale down or sell their business. In some cases, a relative takes over but more often than not the place closes and some other business moves in.
Does it really work that way all over Germany or is it something specific to Berlin?
In some buildings the owners have found ways around the rules, like selling the building to investment funds with enough money to tear it down and build a new one. Or maybe made enough renovations to make larger rent increases legal, but some building owners seem content to just get the steady income without doing much about it.
The big rent increases mainly come from all the new or completely renovated buildings and those are mostly owned by large investment companies.
I personally hope we eventually get enough grip on our cities to tell those investors who are foreign to go fuck themselves and seize their buildings, but it’ll probably take some time until we get to that point. Or maybe it won’t, around 30% of the population supports it or something similar.
Yes, yes, I know this is communism and will bleh bleh bleh, but we can’t keep letting the wealthy herd the poor around like this and expect our society to remain positive about our democratic ideals.
The real issue I think is that modern wages can't support the cost of new construction. If they could people would simply build more houses themselves.
I.e. in Munich, the average rent per square meter is about 10€, while the average for new offers is almost 17€.
This is a problem because nobody is moving out of their places, so people get stuck in the wrong flat. Old people won't leave their too big places after their kids left, young people with kids live in places that are to small.
(No shade thrown at the old people, I'd also not want to leave the place I lived in for so long. But on a bigger scale, it's an issue.)
Anecdata #1: a long-established barber shop paying a fifth of the rent that the very similar empty unit next door was advertised for.
Anecdata #2: just too many ‘businesses’ which offered little of interest and which never seemed to have any customers; some shops even only opened for a fraction of the year (eg those selling Fasnacht regalia).
Some of them are just money-laundering fronts for organised crime.