The sprawling boulevard, which is lined with Stalinist-style buildings and was the showpiece of the former East German government, has been at the frontline of a long fight over gentrification and rising rent costs for months.
An outcry was sparked after property management firm Predac announced last November it was offload 700 apartments on the road that stretches from Mitte to Friedrichshain to Berlin’s largest property company Deutsche Wohnen.
But on Monday, the local government confirmed that the flats will be taken over by the state-owned housing association Gewobag. The apartments had been privatized in the 1990s.
No information on the cost to re-nationalize the homes has been given, but estimates range between €90 and €100 million.
It is a win for tenants who have been organizing protest marches and hanging banners from their apartments in a bid to block the sale.
“Berlin must regain more control over its rental market, said city mayor Michael Müller in a statement. “These 670 apartments are a first step in this direction.”
Locals feared Deutsche Wohnen, which owns 115,000 flats across Berlin and its surrounding regions, could have significantly increased the rents.
READ ALSO: Berlin sees reed over Karl Marx Allee sale
A poster for a 'rent insanity' protest in Berlin. Photo: DPA
Battle rages against gentrification
Berliners have been fighting against gentrification and rent increases for years. Regular 'rent insanity' protests are held in the capital.
Recently, the Berlin government voted to freeze rents for five years from 2020 in a radical move to halt rising rents.
The Karl-Marx-Allee struggle is also part of a wider debate in the German capital on whether authorities should be allowed to take the radical step of requisitioning apartment buildings.
Berlin's mayor Müller has said the city would look to reclaim more apartments from private hands like the Karl-Marx-Allee example.
“I want Berliners to continue to be able to afford housing in the city – housing is a central social issue in almost all major cities,” said Müller.
“Therefore it was, and is, my intention to buy flats wherever possible.”