Accommodation for profit,not for refugees: Racial capitalism and the logics of Berlin’s refugee accommodation market

Racial capitalism, urban housing, and migration governance

The concept of racial capitalism was coined by Robinson (2000). It asserts that racialized exploitation and capital accumulation are mutually reinforcing, and that “racial capitalism is not one of capitalism’s varieties, [… but that] all capitalism, in material profitability and ideological coherence, is constitutive of racial capitalism” (Jenkins and Leroy, 2021: 1). It works through the social differentiation and hierarchization of race, disposability, and the unequal differentiation of human value according to race, as well as through the entwinement of race (and racism), economic exploitation, and class (Melamed, 2015; Walia, 2021). According to Jenkins and Leroy (2021), racial capitalism functions in three ways: through violent dispossession for capital accumulation, through the creation of racial distinctions, and through naturalizing the distinctions and inequalities that capitalism produces (often through state violence, stigmatization, and marginalization). These unfold in the unequal distribution of resources, social power, rights, and privileges. Racial capitalism is characterized by and relies on Janus-faced logics of inclusion and exclusion: racialized populations can be included and forced to participate in economic arrangements of exploitation and expropriation (slavery, colonialism), and they can be excluded from modes of production and accumulation through containment, incarceration, abandonment, and underdevelopment, as a racial(ized) and “relative surplus population” (Bhattacharyya, 2018; Jenkins and Leroy, 2021).

This “relative surplus population,” a concept derived from Marxist political theory, encompasses populations that “struggle to translate their body power into recognised and valued labour” (Rajaram, 2018: 627f.). It represents a dynamic “reserve army of labour” that becomes or is made surplus to the requirements of the capitalist accumulation system, but is always available as a source of cheap labor for capitalist exploitation and for controlling and disciplining all of the working class (Ferguson and McNally, 2014; McIntyre, 2011). Race plays a central role in the production of a surplus labor force (Merrill, 2011), which is why “one cannot understand surplus populations without understanding how the geographical dynamics of accumulation have become increasingly racialized” (McIntyre and Nast, 2011: 1466). This means that “race” is imprinted on populations whose labor is not free and surplus-producing, and who are systematically excluded from economic opportunities and exploited as a means of maintaining capitalist power and control, often in the form of profitable exclusion (McIntyre, 2011; Rajaram, 2018). In this vein, the critical theory of racial capitalism is a way of understanding the role of racism, and the construction of race and racialization in enabling pivotal points of capitalist development. This includes “the processes by which the key dynamics of capitalism—accumulation/dispossession, credit/debt, production/surplus, capitalist/worker, developed/underdeveloped, contract/coercion, and others—become articulated through race” and within class hierarchies (Jenkins and Leroy, 2021: 3).

Structures of racial capitalism (re)produce urban space. As Harvey (2001) prominently argues, the built environment and urban space are produced as a resource system to generate value and surplus value. Further developing this idea, Bledsoe et al. (2019: 16) indicate that this spatial fix “preserves and propagates capitalism” while it “also entails a racial (fix)ation as the continuation of accumulation,” treating certain people and places as “obsolete, in need of appropriation, removal and erasure” (Bledsoe et al., 2019: 16). The production of racial difference is, as Fields and Raymond (2021: 1629) argue, at the core of the production of value; a process that is fundamentally a spatial one, “whereby the sorting and separation of social groups into distinct geographies serves as the basis for racialized expropriation.” The uneven capitalist development of urban space is “a racialized process of (de)valorization and (dis)accumulation that relies upon legal and extra-legal racialized violence” (Loyd and Bonds, 2018: 2). In particular, housing—including its availability, accessibility, affordability, and desirability—is inextricably linked to racialized conceptualizations of space, place, and people based on neoliberal racial capitalism (Fluri et al., 2022). Racialized division and subordination are necessary to the production of value in the housing and real estate market (Fields and Raymond, 2021), “denying bodies constructed as ‘other’ (or performing outside normative expectations of neoliberalism) access to housing, property, and social spaces of privilege” (Fluri et al., 2022: 241). Residential segregation, housing discrimination, displacement, and evictions (often in the context of gentrification processes and high-end development projects), limited locational options for housing, and unequal housing opportunities (and burdens) are mechanisms of racial capitalism. They result in profit extraction and greater exploitation of racialized residents (Crowell, 2022; Fortner, 2023; Rucks-Ahidiana, 2022; Shabazz, 2015).

The ideas and logics provided by this scholarship “can clearly be traced in the area of migration, where it [racial capitalism] operates through the dichotomies of ‘legal’ and ‘illegal’ migrant, ‘authentic’ and ‘bogus’ asylum-seekers” (Bird and Schmid, 2021: 7), where racial capitalism, imperialism, and dispossession are often the starting point of migrant movements, and where thus “the production of exploitable, generally racialized ‘others’ is the bedrock of our current economic system” (McGuirk and Pine, 2020: 3). Studying migration processes and migrants through the lens of racial capitalism and as part of racialized relative surplus populations oppressed by capitalism allows us to bring together and concentrate on two aspects. First, it enables us to focus on “the common marginalisations of subaltern and racialized groups before capitalism” (Rajaram, 2018: 627). The experiences of migrants and refugees, and their access to protection, rights, and settlement are mediated by race and ethnicity, and therefore embedded in the social and economic power structures of racial capitalism in which “race operates as a structure of power according to which privileges and rights are allocated” (Achiume, 2021: 2). Capitalism exploits and marginalizes migrants and refugees as racialized surplus populations in order to maintain profits and power. In this regard, Georgi (2019) establishes the notion of “fortress capitalism” to capture the elements, state, and economic rationales that restrict and control the mobility of refugees, migrants, and the “global working class” for the requirements of labor, or for their (often profitable) fixation, containment, and rejection as “surplus population” in response to the “capitalist multicrisis.” They are made surplus to the requirements of capital and regimes of accumulation, framed as socially undesirable, and unabsorbed by capital (Bhagat, 2022). Therefore, “the ways in which refugees and migrants are governed in Europe is related to their position within contemporary capitalism” (Rajaram, 2018: 627).

Second, it helps us to reveal the connected dynamics of racial capitalism vis-à-vis the power structures and systems of value and the state related to migration that are linked to and animate capitalist modes of production, and through which “race,” “refugees,” and “migrants” are produced in the service of racial capitalism. This is relevant, because even though refugees may not be “an external population different in its relation to political and economic structures” (Rajaram, 2018: 629), they may nevertheless face even deeper marginalization and conditions of systemic racial violence exceeding that “of extant relative surplus populations due to economic hyper-precarity, detention, deportation and circuitous displacement” (Bhagat, 2022: 974). Migration and asylum laws and policies operate within logics of racial capitalism and racializing and class-making processes, both at the level of the organization of labor recruitment and through border and migration control technologies (Gutiérrez Rodríguez, 2018). However, these processes are governed by border regimes that constitute extreme zones of profit extraction, where human lives are treated as economic assets (Franck, 2018) and where unruly mobility is divided and disciplined according to the organization and enactment of racialized differences and inequality (Tazzioli, 2018). Therefore, racial capitalism is not “a simple mode of economic exchange: its relations of exchange are mediated by social values and hierarchies, leading to the marginalization of some as ‘surplus’ populations who have difficulty in valorising their labour” (Rajaram, 2018: 627). For migrants and refugees, the state implements laws and legal-spatial technologies (such as bordering, detention, deportation, camps, and dispersal) to control and govern the mobility and rights of refugees in order to create revenue. This leads to their social insecurity and forms of marginalization and exclusion, including discrimination, poverty, and exploitation, through specific and violent techniques, as well as practices of categorization, dehumanization, valorization, and containment/encampment (Bird and Schmid, 2021). Consequently, migration and asylum laws, policies, technologies, and spatial productions have become central racializing techniques, yet—as I will show in this article—they are linked to, and work through, “a shared logic of immobilization and containment of oppressed populations under racial capitalism” (Walia, 2021: 28). The case of migration thus makes clear what Kelly (2021: xiii) underlines in a new foreword to Robinson’s Black Marxism: “racial capitalism’s driving force was not the invisible hand of the market but the invisible fist of state-sanctioned violence.”

Refugee accommodation as a “migration fix”

To explain these processes and to draw further links between racial capitalism and migration regimes, Bird and Schmid (2021) develop the concept of “migration fix,” which describes “a system of bordering and encampment to manage the uneven effects of capitalist development,” such as regulating the access of surplus populations to territory, labor, and housing markets. Inspired by Harvey’s spatial fix, migration fix sees some spaces and areas as suitable for racialized and displaced populations and migrants, while the access to other areas and spaces is limited. It points to the processes through which political, technological, and social measures are enacted to manage and fix various racialized surpluses in space, producing spatialities of surplus populations, reproduction, and race (Nast, 2011). To do so, the migration fix “deploys an array of bordering, channeling and containment practices to regulate surplus populations and create opportunities for profit-extraction” responding to “a broader range of political and social imperatives by managing various surpluses in the support of domestic interests and nativist political projects” (Bird and Schmid, 2021: 10ff.). Utilizing a similar approach regarding migrant detention—referred to here as the “detention fix”—Trujillo-Pagan (2014: 30) explains that detention is a “state investment in capital accumulation,” serving as a spatial fix to manage finance, land, and population surpluses. In such cases, the state acts to create and sustain conditions for accumulation to take place, “regulating racial capitalism and warehouse[ing] its surplus populations, thus maintaining state violence against oppressed communities,” including migrants and displaced populations, as Walia (2021: 150) elaborates.

Because I am interested in the ways in which value and hierarchies are reinforced by capitalist modes of production in relation to refugee governance and racialization processes, I use the concept of “migration fix” as a springboard to examine refugee accommodation within racial capitalism and the ways the contradictions of race are realized through the spaces and the bodies race calls to order (Winant, 1994 in McIntyre and Nast, 2011). The migration fix helps us to conceptualize accommodation as a racialized system, spatiality, and technology of bordering and containment shaped by legal, economic, and political conditions and practices, and set in place to regulate and spatially fix displaced people as racialized surplus populations while creating conditions for accumulation. Because state restructuring processes have resulted in a transfer of policies and responsibilities from national to municipal scales, and thus cities have become the preferred space for the implementation of migration management policies and control technologies (Darling, 2017), refugee accommodation exemplifies that the migration fix also unfolds in urban contexts. Its logics and mechanisms are deeply imbricated in urban governance and urban racialized markets, in turn embedded in the neoliberal and racial urban and housing policies explained above. In cities, refugees and migrants are placed in various situations and conditions of dislocation, fixation, housing precarity, and shelter, and prevented from accessing stable housing; however, their lack of shelter security makes them “new potential streams of revenue” and “useful as mass bodies awaiting processing at various border locations”—urban ones included (Bhagat, 2022: 964). These processes “are built into the urban environment with housing as a key feature of [racial] neoliberalization” (Bhagat, 2021: 637), in which housing constitutes sites of “racial and class domination” (Bonds, 2019: 576). In this regard, refugee accommodation comprises instruments to manage and fix displaced people within these urban racialized markets. They are the sites seen as suitable and developed for racialized and displaced populations, while they keep them away from other urban areas and regular housing. At the same time, they are tied to, characterized by, and placed in capitalist property, and racialized and socially unequal urban housing regimes. They are not detached from, but “deeply embedded in a ‘hyper-commodified’ housing and real estate market” (Sowa, 2020: 112), including “the mutually constitutive pillars of racism and economic exploitation” (Korver-Glenn et al., 2021: 9, emphasis in original).

Refugee accommodation is therefore an urban migration fix and a race-making, class-making, and space making institution for regulating people and space for capital, and for the ongoing production and control of race and racialized populations in cities (Bonds, 2019; Danewid, 2020). It comprises an urban state project of bordering and encampment to manage the uneven effects of capitalist development, and through which refugees—who cannot make themselves valuable or are not allowed to—are made valuable to sustain and expand capital accumulation and in the support of state and urban interests. To achieve this, I argue and further show in this article that urban state actors and capital rely on the (re)production of social and racial hierarchies including two racialized valuations reinforced by capitalist modes of production: first, the “status value” defined by Martin (2021: 742) as the “legal categorizations (refugee, asylum-seeker, labour migrant, illegal alien)” that “produce a particular form of value specific to migration control regimes through which commodification becomes possible.” Second, the “spatial value,” which I define as value produced by and through the development of refugee accommodation, and the fixing and concentration of refugees in shelters. This second facet of value-making results from my empirical analysis, in which I exemplify that the construction of accommodation is used for the development of urban land and profitable substandard housing, while regulating (and limiting) the access of refugees, as racialized relative surplus populations, to local housing markets. Status and spatial value combined represent a particular form of exploitation—a method of profitable spatial exclusion and management, in which refugees are not necessarily directly, but secondary, exploited by capitalism, so where the resources they rely on (status, rights, housing, etc.) are used as a commodity and for profit-making and accumulation.

Through their status and stay in accommodation, refugees are made valuable by their excludability, confinement, and disciplined mobility, while at the same time the urban place they are forced to inhabit becomes valuable as a result of the access to and the development of land and the built environment. These aspects of value are relevant to the dynamics of capital accumulation and become possible through the making of refugees as racialized surplus populations under racial capitalism. In other words, refugee accommodation forms an arena of racial capitalism—sites of profit-making and sites where value is extracted from refugees, their continued racialization, and the spaces they occupy, serving urban state ambitions for creating and sustaining the conditions for accumulation. This urban migration fix then exemplifies how “racial inequalities and racial discrimination are central to capitalist production strategies in neoliberal globalization and produced in specific spatial contexts” (Merrill, 2011: 1543). It explains how racialized hierarchies of surplus populations have been legally and politically constructed, spatially realized and reproduced, and economically used for localized capitalist systems of production and the exploitation of refugees and migrants. However, as I show in the following analysis, in Berlin, the construction of new refugee accommodation is also the starting point for developing a form of public housing for racialized and lower-income urban populations, exemplifying the processual and relational entanglement between race and class in housing markets (Korver-Glenn et al., 2021).

From privatization to the entrepreneurial “re-municipalization” of accommodation

Berlin’s refugee accommodation market has gone through intense restructuring and marketization processes in recent years. Prior to the end of the 2000s, six welfare organizations operated the then 10 refugee accommodation facilities, largely in existing (office or social facility) buildings or containers. However, between 2014 and 2016, there were over 130 shelters for refugees, many of them hastily opened as emergency shelters in gyms, hotels, schools, and even in one of Berlin’s former airport buildings. Attempting to respond “efficiently” to the need for shelter during the refugee reception crisis, the government outsourced services related to accommodation and disproportionally contracted for-profit companies for its running, turning refugees into a commodity whereby their “status value” is translated and circulated between the institutions and organizations involved in accommodation management and administration (Martin, 2021). Nevertheless, corruption, forms of nepotism, and opaque and fraudulent public–private relationships and procurements concerning operating contracts, costs, and the mandating of services grew at that time. This resulted in tumultuous and often violent reception conditions and public scandals (for a detailed analysis, see Kreichauf, 2023). To regain control over the chaos of refugee arrival and accommodation, the Berlin government established the LAF as the single authority responsible for all matters concerning asylum and accommodation, and it developed the “Refugee Housing Program” in 2016. At the core of this program are the so-called MUFs (Modulare Unterkünfte für Flüchtlinge or “modular housing for refugees”). MUFs are exclusively built by the Senate for Urban Development and Berlin’s public housing companies on city-owned (or purchased) land, in accordance with the quality and shelter requirements of LAF, and predominantly with federal funding. They are “well-designed, high-quality, durable and sustainable communal accommodation of solid construction” based on prefabricated concrete modules (SenIAS, 2021). The layout is of four to six stories, with dormitory-style housing for single adults or an apartment-style layout with a mix of different-sized apartments for families. They are equipped with modern thermal insulation and under-floor heating. However, they still include security staff, entrance control, and fencing that is typical of refugee shelters in Berlin (see Figure 1). Once a MUF unit is realized, it is rented by LAF, which contracts private actors for operation and services through bidding processes. A total of 52 MUFs are planned, housing up to 500 refugees per unit, or 26,000 in total. As of 2022, a total of 29 had been realized, accommodating around 10,000 people.

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Figure 1.

Berlin’s new refugee accommodation, an example of a so-called MUF.

The Refugee Housing Program represents a turning point for the construction, provision, and purposes of accommodation in Berlin. First, it breaks with the idea of refugee shelters being temporary accommodation and follows a broader and long-term urban development and housing vision: MUFs are developed to house refugees for longer periods and to be gradually opened up as social housing for other groups. Second, the program reflects a “re-municipalization” of accommodation provision. Public authorities and corporations take over the planning and building of accommodation on city-owned or purchased land. This “re-municipalization” has been driven by economic and racial rationales. On the one hand, it is connected to the business-like corporatization of public companies, which can be “more commercial than their private counterparts, having to focus more on surplus as mandated by their owner-governments,” thus creating the conditions for capital accumulation (Voorn et al., 2021: 310). On the other hand, refugees, their trajectories, and their livelihoods remain under the close control and authority of the state, thereby making refugees valuable for profit-extraction and capital accumulation through long-term accommodation and the development of substandard housing. In the following, I examine these developments in greater depth, revealing the ways in which the Refugee Housing Program establishes conditions to turn shelters and refugees into a commodity through which race-based profit is made.

Continued displacement, evictability, and the production of substandard housing

The Refugee Housing Program and the development of MUFs need to be understood against the backdrop of Berlin’s tense housing market and the lack of affordable housing—problems that were exacerbated by neoliberal policies and the privatization of housing after German reunification (Soederberg, 2018). Impelled by the Berlin banking crisis in the early 2000s and by increasing public debt, the Berlin government introduced strict austerity measures for public budgets and services, and started to reduce its commitment to social housing by selling public housing companies to private investors and by pushing the remaining six public housing companies to be profitable (Holm, 2013). Moreover, it sold much of its public land, especially in the inner city. This era was “austerity urbanism” par excellence (Peck, 2012). Consequently, rents in both the private and the public housing sector increased rapidly: between 2009 and 2021, they more than doubled from around 5 euros to 11 euros per square meter (Statistica, 2022). Further, since 2007, Berlin’s six city-owned companies together have increased their rents even more than the three largest listed housing companies (BBSR, 2017). As a result, Berlin has experienced a lack of affordable housing and has gone through gentrification and urban displacement processes that disproportionally affect non-white and racialized Berliners (Polat, 2020). These trends have coincided with the growing arrivals of refugees since the early 2010s, who face an increasingly inaccessible and racialized housing market. According to my analysis based on data from LAF, in spring 2022, over 60 percent of the more than 24,000 refugees in the accommodation system had a protection status. This means that they are allowed to move out and rent apartments on the housing market; however, most are unable to find individual apartments and stable housing, and are forced to stay in accommodation for longer periods or they would face homelessness. More than 70 percent of the refugees in accommodation have been living in shelters for over two years; 29 percent of them for four years or more. Due to the declining likelihood of succeeding in accessing housing, their search for a stable home stagnates in a state of limbo for a long period.

Refugee housing in cities such as Berlin is deeply imbricated in “an already burgeoning crisis of homelessness and affordable housing” (Bhagat, 2021: 635). Against this backdrop, the Refugee Housing Program and the development of MUFs indicate “how the government is reacting to a situation that is shaped by a lack of public housing and a scarcity of public land” (Sowa, 2020: 112). As a representative from the Senate Department for Integration, Labor and Social Affairs (Interview SenIAS, 2019) stressed in an interview: “Berlin left housing to the free market, and the development of MUF is our only real means to respond to this at the moment and to provide housing for those who can no longer find housing.” MUFs aim to increase the city’s housing supply in two ways: on opening, they solely accommodate refugees in the asylum procedure and those who have been granted protection status but cannot find housing, and who are and will be excluded from the housing market for longer periods. In phases, MUFs will also be used to provide housing for other vulnerable groups, either in the form of social housing and micro-apartments, or as dormitories, homeless shelters, elderly homes, etc. They thus function in two ways: accommodating refugees for the longer term and adding housing “for other Berliners looking for housing” (Interview LAF, 2019). The latter implies housing for people who fall out of Berlin’s tense housing market. This population disproportionally consists of Berliners with migration history or without German citizenship (DESTATIS, 2022), but also includes lower-income households. In this regard, the Refugee Housing Program is part of the long-term planning for expanding housing segments, as well as developing new social housing sites and permanent forms of housing for Berlin’s racialized and marginalized populations in a struggling and unaffordable housing market.

The problem with MUFs, however, is that they want to appear as a new form of social housing, but they are not. While they may represent a material improvement in accommodation conditions, they sustain the institutional character of the camp and introduce lower standards for housing provision in Berlin. According to planning laws and building regulations, they are “social institutions and special constructions not comparable to residential housing” (Interview SenIAS, 2019). MUFs are designed in reference to the quality and shelter requirements of LAF, and have occupancy rates that are twice as high as other forms of city-provided long-term “social housing.” The MUF blocks are physically marked as places that differ from normal forms of housing, sustainably carrying a stigma and being set apart from the rest of the neighborhood in which they are developed. According to my study based on the location of realized and planned MUFs, and compared with data on socio-spatial inequalities in Berlin, around 45 percent of all MUF developments are sited in socioeconomically weak areas at the periphery of the city, thus in areas with relatively high rates of unemployment and poverty. The MUFs “may result in the [further] ghettoization and marginalization of refugees” (Soederberg, 2021: 169). For the accommodation of refugees, the developments do not involve rental contracts and therefore do not offer tenants’ rights. Instead, refugees sign a “housing agreement,” including detailed restrictions and regulations about the living arrangements and the conduct of everyday life (such as stipulations on interior decoration, visiting hours for guests, a smoking ban, etc.). This agreement also states that residents can lose their place in the accommodation facility if they break the “house rules.” Furthermore, housing in MUFs is characterized by involuntary placement: residents do not choose to live in a MUF, they cannot decide which particular MUF they want to reside in, where exactly in the MUF, and who they have to live with. While some of the refugees I interviewed expressed a desire to live in a MUF, most respondents highlighted that—despite MUF’s material improvements—“a camp is camp” (Interview R 3, 2022). They criticized the location of MUFs, the strict use of space, and the fear of being relocated to another facility. According to one of the interviewees, who had lived in one of Berlin’s single-floor container villages before being transferred to a MUF, the better housing quality of MUFs does not compensate for the lack of autonomy. The interviewee had established a small garden in front of his container in the village. He did some gardening there, and his children had the opportunity to play outside simply by opening the container’s door. For that reason, he still preferred living in “his” container, because it provided him with more autonomy and a sense of community compared with living in a MUF (Interview R 4, 2019).

MUFs are not (autonomous and rent-based) housing, but substandard—deliberately undermining spatial, technical, and social standards and features for those who are excluded from the regular housing market (Mattern, 2018). They represent spaces and conditions of “accumulated homelessness” (Belloni and Massa, 2022) and “evictability” (van Baar, 2017). This is because in view of the high percentage of people with confirmed protection status—meaning Berlin residents with a refugee and displacement history—who live in accommodation because they cannot access regular housing, MUFs in fact already work as housing for the homeless and those displaced from regular housing (Interview LAF, 2022). Franziska Giffey, the mayor of Berlin until 2023, noted in 2016 that “they are actually homeless people, homeless refugees that fall under our responsibility to care for them, not as refugees but as homeless refugees” (van Laak, 2016). MUFs concentrate people with experiences of displacement and losing their home, while at the same time they reproduce and accumulate displacement and homelessness, including precariousness, marginality, and exclusion. For refugees—and because of the lack of rental contracts and tenants’ rights in these shelters—this results in constant situations of shelter insecurity, fear, and danger of “the possibility of being removed from a sheltering space” (van Baar, 2017: 214). As the data available from LAF and the trajectories of my interview partners indicate, the development of MUFs facilitates the protracted displacement of refugees in these designated places, turning the temporary nature of refugee accommodation in Berlin into a permanent condition; not only for refugees but—through its gradual expansion—also for other racialized and marginalized populations alike. Contributing to this, asylum accommodation has been integrated into Berlin’s centralized city-wide accommodation management system (Gesamtstädtische Steuerung der Unterbringung, GStU), which was piloted in 2021 and is slated for full implementation by 2024. The GstU is overseen by LAF and seeks to unify and centralize the lodging of refugees with that of other homeless populations. This entails the consolidation of all public institutions responsible for social welfare, including homeless shelters, youth homes, Berlin’s women’s aid, and housing programs, under a single and centralized lodging system. This trend is consistent with Rajaram’s (2018) findings, which suggest a correlation between the management of an ostensibly problematic internal population, such as the homeless, and that of the externalized population of migrants and refugees. In Berlin, the development of MUFs thus symbolizes the merger of refugee/migration policies with social and urban development policies, and similar circuits of housing provision, and the blurring of the distinctions between camps and housing and between refugees and the (often racialized) poor. They also permeate low-income public housing and housing estates. MUFs establish a new lower standard for housing construction and social housing under neoliberal auspices—one that does not aim at the supply of affordable housing, but at the mass processing and sheltering of marginalized, internationally and urban displaced and racialized surplus populations.

Building accommodation for developing housing: status value and spatial value

Because it is rare “for surplus populations to be banished to a governmental void and left to fend for themselves” (Cheshire and Zappia, 2016: 2085), MUFs are the political, technological, social, and economic instruments to fix and to continuously control and manage these populations in Berlin’s racialized and exploitive market. They are developed as sites suitable for racialized and displaced populations, while they function to regulate and channel the access of these groups to other urban areas and regular housing. As a migration fix, they reflect the ways ideology, social values, and hierarchies are reinforced by capitalist modes of production, concentrating refugees to make them valuable and to create multilayered and complex opportunities for making revenue. As explained in section ‘Racial capitalism and refugeeaccommodation’, and as I will discuss in more detail in the current section, this works through a combination of status and spatial value for which Berlin’s government uses its authority, legal categorizations, and laws to create conditions for value-making.

To realize the Refugee Housing Program, the Berlin government utilized some loopholes offered through the introduction of the Refugee Building Law (Sonderbaurecht für Flüchtlinge) to the Federal Construction Planning and Zoning Law in 2014–2015. This has allowed exemptions from regular planning, zones, and building procedures and requirements, simplifying and accelerating the development of new forms of refugee accommodation in response to the need for such housing in Germany. For Berlin officials, this law has opened up the possibility to develop land and to construct buildings in areas that were previously politically and legally not accessible, and were deemed unsuitable for residential use. Applying this law has allowed a strictly top-down procedure for construction, without civic (or refugee) participation, democratic decision-making processes, lengthy approval procedures, or the possibility of legal and environmental appeals—measures that are an inherent part of regular planning and construction procedures. In close to 60 percent of the cases, the Refugee Building Law has been applied for building MUFs, overruling regular building regulations. As an LAF representative (Interview LAF, 2019) explained in an interview:

The Refugee Building Law is a systematic way of putting areas into use that otherwise could not be put into use […]. With the refugee law, I can get access to land that I would otherwise not be allowed to build on […]. This means that the Refugee Building Law allows us to create special building areas that would otherwise not be available [to develop] MUFs and much needed affordable housing in our city.

The development and housing of refugees in accommodation is not only a race-making but also a space-making practice. Through accommodation, mechanisms of containment and constraint are built into architecture, urban space, and the landscape. As Shabazz (2015) explicates, when referring to the production of Blackness and the architecture of confinement in Chicago, public housing projects for racialized populations—their construction, location, architecture, and planning—are informed by policing, systems of control, the establishment of borders, restrictions on mobility, and the production of territory and particular types of urban spaces that in turn impact on the (re)production of race and otherness. He argues that these strategies are used to “spatialize blackness” and to make profit out of this spatialization. In my research, there is a “spatialization of refugeeness,” including racialized consequences for refugees in the city. The spatialization of refugees, or the racialized spatiality of refugees, creates spatial value through this racialization and the “fixing” of refugees in accommodation for the production and expansion of urban land. This becomes clear when looking at the purposes of the Refugee Housing Program. In 2016, then (and again, between 2021 and 2023) Berlin Senator for Urban Development, Andreas Geisel, stressed that MUFs will “become the nucleus for the long-term development of an area, through which new neighborhoods and residential areas can emerge” (in Sethmann, 2016, author’s translation). Some MUFs are strategically built in areas where the city has long held ambitions to develop (often contentious) housing projects and residential areas, but where developments have been delayed because of difficult access to land, complicated legal and technical situations, or citizen protest. Applying the Refugee Building Law, the city can create precedents for the further development of residential areas and social housing in environments previously not possible to develop, through a later change to the use of refugee accommodation as social housing and shelters, as well as to initiate the further development of (social) housing (areas) and urban land.

Through such urban development approaches, “value is being derived from both people and places” (Dantzler, 2021: 118). This “spatial value” is produced by and through refugee accommodation: the place of accommodation becomes valuable for the access to and the development of land, and for turning accommodation into profitable, substandard housing. In this way, land for housing is treated as the terrain of capitalist accumulation, where the city can put urban land into production through accommodation and refugees, while creating conditions for accumulation, profit extraction, capital, and spatial expansion. In these processes, “the production of racial difference is core to the production of value” (Fields and Raymond, 2021: 1629): without racial difference and racialization, the government could not use MUFs as a tool to put land into production and develop housing. Both status and spatial value underline the relationship between racial capitalism and the role of the state, which can implement technologies (laws, policies, categories, accommodation, etc.) to control and govern the mobility and rights of refugees in order to establish the conditions to create value. It does so through the construction of refugee accommodation itself, and then by enabling land and housing development. In the following section, I explain how and for whom this value is created.

Refugee accommodation and the refinancing of housing companies

The Refugee Housing Program and the development of MUFs is a public investment in capital accumulation and the financialization of housing, serving to create and sustain conditions for accumulation, and enabling public and private companies to capitalize on refugees. Financially, this works through the restructuring, channeling, and (re)dedication of federal funds, as well as complex public–private arrangements around accommodation construction and operation, and refugee care. Here again, the combination of the status and spatial value of refugees and refugee accommodation is relevant for public and commercial gain.

While Berlin as a German Bundesland is responsible for reception and accommodation, the federal government covers most costs, and it subsidizes the Berlin government for the development and administration of accommodation and for the care of refugees. Berlin benefits from several streams of federal subsidies for the construction of accommodation. In order to build a MUF, the State of Berlin, or the housing companies directly, use either city-owned land or “receive” land from the Federal State Agency for Real Estate Tasks (Bundesanstalt für Immobilienaufgaben, BimA). The BimA holds public and state-owned properties in Berlin. In the event that a housing company buys a property directly from BimA to develop a MUF, it receives a purchase subsidy from Berlin’s Senate Department for Finances and a discount from BimA. This makes the development of MUFs less cost intensive. In addition, housing companies charge higher rents for the accommodation of refugees compared with rents in social housing, and the occupancy rate of MUFs is twice as high as it is for other forms of city-provided housing. Built by the housing companies, the LAF leases the MUFs to house refugees, and it subcontracts private agencies to run them (Interview LAF, 2022). The accommodation of refugees including the rent in shelters is financed by the federal government. For refugees in asylum procedures, the federal government covers 670 euros per refugee per month. For refugees with residence status who are still in accommodation, however, the federal government covers 100 percent of the costs through social welfare funding (Sozialgesetzbuch II) (SenIAS, 2021). The LAF’s rent payments to the housing companies thus come from federal budgets. Consequently, housing companies charge relatively high rents: the net rent in MUFs is 13.50 euros per square meter, a price comparable with luxury apartments in Berlin’s city center.

When closely analyzing the financing structures of the Refugee Housing Program and the development of MUFs, it becomes clear that the Berlin government uses them to finance its public housing companies, which have been—in the regime of neoliberal urbanism and financialization—forced to accumulate profit and to function as commercial enterprises. They are legally organized as limited liability companies or public limited companies. Rent payments serve as the basis of securitized bonds, and most of the surplus rental income is used to service loans. The remainder is partly retained as profit, or goes toward the city’s budget. In this financialized market, the re-municipalization of refugee accommodation and the MUFs serves as an economic stimulus package for the housing companies. This is because housing companies can obtain higher interest rates developing MUFs compared with regular forms of social housing. With expenditures exceeding 22 million euros for each MUF and 1.1 billion euros in total (excluding costs for operation and services), the development of a MUF is more expensive than high-quality social housing. However, the housing companies can access and develop land cheaply and gain higher revenues, because the purchase of land, the construction of asylum accommodation, and the housing of refugees through LAF is federally subsidized. This allows for a shorter payback period and fast amortization (it would be twice as long for social housing). When MUFs are turned into “social housing” or shelters for accommodating other groups, they will already have been refinanced and amortized through the accommodation of refugees. This makes MUFs a profitable solution—both for the accommodation of refugees and for later use as social housing. Because some MUFs are located in areas targeted for further development, housing companies also benefit from building MUFs as tools to more easily develop urban land and potentially even from selling land.

While public companies and agencies oversee the planning and building of MUFs, the Berlin government contracts private companies for their construction and running. Looking into the contracted companies and payment volumes reveals opaque and fraudulent public–private relationships, which I have analyzed in greater detail elsewhere (Kreichauf, 2023). In short, with regard to construction, two companies have disproportionally received mandates and share a monopoly for constructing MUFs, despite EU-wide calls: Klebl Baulogistik GmbH, a midsize company located in Bavaria that was mandated for the construction of 19 MUFs, for which it received over 360 million euros; and Goldbeck Nordost GmBH, which has built or is to build 30 percent of the MUFs. Goldbeck is one of the most prominent companies for modular construction in Germany, and the largest underground car park manufacturer in Europe—which may also be why even a representative from LAF (Interview LAF, 2019) called the MUFs “unbearable and very ugly, like an underground car park but above ground.” With regard to operation, the government promotes a diversity of actors for reasons of market competition and flexibility, as well as to spread authority, accountability, and risk. Currently, there are 15 operators in the market for 29 realized MUFs. Contract conditions between operators and the city are individually negotiated. Such a “diffusion of caring responsibilities among urban actors and the market results” as Georgiou and colleagues (2022: 2209) argue, “in erratic and unequally distributed care with detrimental effects for those who need it the most.” Berlin’s MUF providers include the Norway-based Hero GmbH, one of the largest providers of services relating to refugee accommodation and care in Europe, owned by the multimillionaire brothers Kristian and Roger Adolfsen, and European Homecare GmbH (EHC), which—with over 100 shelters—is the largest private accommodation operator in Germany and has frequently been accused of providing unsanitary living conditions, hiring right-wing extremists as security guards, and allowing the abuse and rape of refugees by accommodation staff (see Polat and Müller, 2017). Because of legal and migration frameworks, the construction and operation of refugee shelters are extreme spaces of racialized profit extraction for the benefit of various public and private actors as well as international capital.