"I think it's good if it's true. Berlin is always in danger of ruining itself with the hype," said Björn, a local, as he walked by the old converted electricity substation. "It was a really big issue here; I still can't quite believe it," said Ute, who runs a flower shop across the street (where an anti-Google flyer was hanging in the window). And Eleni, who has been running a bookshop next door for 11 years, has been struggling to get to grips with the news: "Google is a huge company, and I still can't imagine that they just gave up because of the protests. That'd be nice though."

In fact, a lot of Kreuzbergers were incredulous that Google, the internet juggernaut with a $90-billion (€80-billion) yearly revenue, had apparently been driven out of the Berlin district by local activists trying to preserve the area from gentrification.

It was an abrupt turnaround. On Wednesday, the internet giant announced that it would no longer be installing a Google Campus for startup companies in the Umspannwerk, as the substation is now called. Instead, Google said it would rent out the 3,000-square-meter (32,300-square-foot) space to local charity Karuna and betterplace, a Berlin-based donation platform, to make available to Berlin social projects.

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Local resistance

Google originally announced the new Google Campus in 2016, on a model already established in London, Madrid, Warsaw, Seoul, Sao Paulo and Tel Aviv, where the campuses are meant to provide working space and seminars to entrepreneurs setting up tech companies.

But in Kreuzberg, already a battleground for real estate investors, Google encountered much resistance. Several local neighborhood initiatives formed an alliance against the plan, unified by a website entitled "Google is not a good neighbor," with monthly demos and even a brief occupation of the building site. The demonstrators weren't shy of strong language either, holding up banners outside the building (which is already occupied by two fancy restaurants) that simply read "F--- Off Google."

Google Germany spokesman Ralf Bremer insisted that the company had not been driven out by the demos. "It was clear after a few months that this wasn't going to be a pure startup campus, but with two pillars: startups and NGOs," he told DW. "That became more and more concrete when we spoke to betterplace and Karuna, until we decided that it would be better to make the whole space available to them. There was a small group that was very loud, who didn't want to speak to us, and they have nothing to do with the concept now, obviously."

The anti-Google campaigners claimed that the company's Campuses had always triggered massive rent increases wherever they had appeared, pricing local shops and small businesses out. This campus, they said, would just increase the burden on a city that is already dealingwith the fastest rising property prices in the world: a recent study found that rents increased by 12 percent between 2017 and 2018 alone.

Google had been in talks with betterplace and Karuna from an early stage. "They noticed: 'OK, maybe at the beginning we didn't do enough to engage with the local area,'" said Carolin Silbernagl, spokeswoman for betterplace, touring the Umspannwerk building site on Thursday morning. "They started to think about how they could do things differently: Are there elements they could integrate?"

"We told them probably what a lot of others told them: If you do anything then think of the social initiatives, because they are also getting gentrified out," she said. "Then the decision when it came was fairly surprising for us too. They said, 'So what would you do if you had this building to yourselves?' So we got together and dreamt something up."

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The investment dilemma

Silbernagl is now fielding dozens of requests from local projects keen to use the space, which includes a 200-seat venue for events, offices, and potentially a workshop and podcast studio. But permanent contracts won't be available, she says, because the idea is to keep as much space as possible open for as many people as possible, and at prices well below the market value.

"A coding school that runs programming courses for refugees, for example, they have already asked," she said. "And a publishing house that puts out German-Turkish youth literature has also shown interest."

Meanwhile, the city government has been forced to put a positive spin on the change of plan. Social Democrat Mayor Michael Müller had initially welcomed Google's plans two years ago, as part of his drive to make Berlin a "startup hub." Now, Berlin's economic affairs minister, Ramona Pop, said Google's decision showed "the increasing importance of socially and ecologically oriented companies and the non-profit-oriented economy. There is a lot of potential for solving social challenges at the meeting point between socio-ecological businesses and innovative tech solutions."

Unsurprisingly, that has not stopped criticism from the city's business-oriented opposition parties. Sebastian Czaja, leader of Berlin's Free Democratic Party (FDP), described the change of plan as "no more than a sugarcoated capitulation."

"Even if the new use is worth welcoming, the message to all future companies and investors is fatal: don't come to Berlin, and especially not Kreuzberg," Czaja said in a statement. "This 'victory' will encourage the district-protection fanatics to torpedo any kind of change." He also accused Pop's Green party of supporting the "anti-Google alliance."

Berlin remains a popular location for startups, and Google already runs a co-working space in the city called The Factory. A "startup monitor" released on Tuesday by the German Startups Association and the consultancy KPMG found that, of the 1,600 startups who took part in the survey, 19 percent were based in the state of North Rhine-Westphalia, and 16 percent in Berlin. But with a population of 18 million, the western German state has roughly five times more people than the German capital. Also, Pop said that with an average of seven employees, Berlin startups scored well above the national average of three.

Silbernagl thinks it's all about getting the right balance: "Innovation and jobs are also created in the social sector. And there is enough opportunity in the city for startups already."