Walking through HafenCity, it’s difficult to imagine the grungy shipbuilding yards and warehouses that once dominated the area. Today, the waterfront property stretching along the River Elbe is filled with offices, cafés, and condos, along with vibrant public spaces and tree-lined streets. The $10 billion master plan for HafenCity—billed as Europe’s largest inner-city development project—calls for transforming 388 acres into 10 distinct quarters. According to city officials, the district will increase Hamburg’s urban core by 40 percent, create an estimated 45,000 jobs, and offer housing for 12,000 residents of varying income levels. The public-private project is being developed by HafenCity Hamburg. With about 40 percent of the buildings finished or under construction, the harbor makeover is scheduled for completion by 2025, although financial woes have stalled several major projects.

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“HafenCity is very multifaceted. It could be a good model for other inner-city developments,” says the German architect Stefan Behnisch, whose firm has completed two major projects there: the Unilever headquarters (2009) and the residential Marco Polo towers (2010). He notes that large-scale developments can be tough to pull off, but HafenCity “ensures quality” through design competitions, constraints for developers, and sustainability requirements.

“The city has fairly tight control over what’s being done here,” adds Bernhard Karpf, associate partner with Richard Meier & Partners, whose Coffee Plaza office building opened in HafenCity in 2010. “The combination of private development with a vision of public good is what’s unique here.”

Hamburg has been a vital industrial hub for centuries. Its historic port, where HafenCity is now taking shape, was rendered obsolete in the 1950s due to the introduction of large, modern container ships that couldn’t maneuver through its narrow canals. Dormant for decades, the port was acquired in 1997 by the city-state of Hamburg, which set out to transform the area.

A collaboration between Dutch firm KCAP and German firm ASTOC, both founded by Kees Christiaanse, won a competition to master-plan the site. In 2000, the Hamburg Senate approved their scheme, which features varied building types and a series of neighborhoods. “The plan has a strong urban context, but enough flexibility to adapt to unforeseen circumstances,” says Christiaanse, who is still actively involved. Last year, ASTOC updated the master plan to incorporate an additional 132 acres.

To foster innovation, design competitions are held for individual buildings, attracting local and international firms. Final decisions are made by a jury of developers, property owners, independent architects, and government officials. “HafenCity will be an ensemble of high-quality architecture,” asserts Jürgen Bruns-Berentelg, chief executive officer of HafenCity Hamburg.

While generally well received, this sweeping urban regeneration scheme is not without problems. Financing woes have plagued some key projects, including a dramatic, ring-shaped science center by OMA, which likely will not get built. Meanwhile, the completion date for Herzog & de Meuron’s Elbphilharmonie Concert Hall has been pushed back to 2014.

The high-profile project, which calls for adding an undulating glass structure atop a renovated brick warehouse, broke ground in 2007 and had been slated to wrap up by 2010. According to Björn Marzahn, city spokesman, cost overruns have plagued the project; the current price tag hovers around $630 million (double the original estimate). A recent weekday visit to the site revealed that tourists outnumbered construction workers.

While some projects are lagging, other architectural landmarks have been completed. These include Coffee Plaza and the adjacent Hamburg-America-Center (2010), by Meier’s office, and the Spiegel publishing house and neighboring Ericus Contor (2011), both designed by Copenhagen–based Henning Larsen. Moreover, HafenCity’s first elementary school, Katharinenschule, by the local firm Spengler & Wiescholek, opened in 2009.

Overall, HafenCity is garnering international attention for Hamburg, helping elevate its status as a global city. For area residents, says Bruns-Berentelg, the transformation of this former industrial zone is a welcome surprise. “People saw this site as dead,” says the developer, “and look at it now.”

This story appears in the January 2012 issue of Architectural Record.