One of Europe’s largest flagship department stores, KaDeWe in Berlin, has caught the eye of acquisitive retailers continents apart.

This story first appeared in the April 23, 2015 issue of WWD. Subscribe Today.

Richard Baker’s Hudson’s Bay Co., the Selfridges Group owned by Galen Weston, China’s Sanpower Group, and Qatari investors are said to be among the parties interested in acquiring the store, although it’s unclear whether the KaDeWe flagship and the rest of the premium group owned by Karstadt are for sale.

The three-store premium group includes the KaDeWe Berlin flagship, Alsterhaus in Hamburg and Öberpollinger in Munich. KaDeWe and Alsterhaus are said to be performing well, while Öberpollinger is considered oversized and underperforming.

The KaDeWe Group is part of the struggling Karstadt chain, which operates 83 midmarket Karstadt department stores and 28 Karstadt Sports stores across Germany.

In August, Karstadt was bought by Signa, the Austrian real estate company and investor, which acquired it from Nicolas Berggruen. The Karstadt chain has been struggling for more than a decade and attempts to revamp and reposition it have borne little fruit. KaDeWe and Signa executives declined to comment on a potential sale.

According to reports out of Germany this week, there was a crisis meeting of senior management recently, with major cut-backs apparently in the works, and the union already threatening strikes. When Karstadt chairman Stephan Fanderl unveiled a restructuring program in October, he said it will “demand much from us” and “not be possible to ensure the survival of the entire group without very painful decisions as well as door closures. All efforts must be targeted at improving operative performance as well as the stores’ profitability.”

One retail analyst close to the KaDeWe Group (formerly the Karstadt Premium Group) said, “KaDeWe is profitable. It was thought more likely that they [Signa] would get rid of some Karstadt [retail] properties, or close some of the loss-making Karstadt department store doors, and concentrate on prime assets like KaDeWe in this first phase. But in this world, everything is possible.”

One retail source characterized the KaDeWe flagship as “the Harrods of Berlin, with a famous food hall on the top floor. But it has fallen from grace over the past 20 years or so. I could envision a department store buyer taking it, somebody with lots of money and existing infrastructure such as Selfridges, La Rinascente or the Qataris. That said, it could be prey for a real estate developer who would convert the building into a shopping mall or flats, or do a Primark on the first two floors and offices or flats above.”

It’s the type of towering retail site that Baker, governor and executive chairman of Hudson’s Bay Co., would covet. HBC bought Lord & Taylor and Saks Fifth Avenue largely for the valuable L&T and Saks flagships on Fifth Avenue in Manhattan, among other sites, and has generated billions in monetizing the real estate under the properties.

The Selfridges Group, led by Weston, could extend its international portfolio with the addition of KaDeWe. The group’s holdings include Ogilvy’s and Holt Renfrew in Canada; Brown Thomas in Ireland; Selfridges in the U.K., and de Bijenkorf in the Netherlands. Also, the Weston family is preparing to bring Primark to the U.S., beginning with a 70,000-square-foot store in Boston toward the end of this year on the site of a former Filene’s department store.

Primark will expand its entry into the northeastern U.S. market via retail space in seven Sears stores. Primark is part of Associated British Foods plc, the publicly quoted company owned by the Weston family.

The Qatari investment group that last year bought French retailer Printemps is believed to be seeking additional companies to buy. China’s Sanpower Group last year bought House of Fraser in the U.K., which earlier this week revealed plans to open three stores in China by 2017.

Sales have been slipping at the $3.45 billion, money-losing Karstadt. With the pruning of stores, 2,400 of the department store chain’s 20,000 employees are expected to lose their jobs, though to date, only about 900 have been let go.

KaDeWe, at 60,000 square meters, or 646,000 square feet, is one of the largest department stores in Europe, and comparable in size to Saks Fifth Avenue on Fifth Avenue. Öberpollinger is 33,000 square meters, or about 355,000 square feet; Alsterhaus is 18,000 square meters, or 193,824 square feet.

“A sale of the premium store group is going through in the next couple of weeks,” said one retail source.

Retail analyst Walter Loeb said, “I don’t think Weston is so interested. How could he be? He’s so busy with Primark.”

One analyst close to the KaDeWe Group said the general consensus has been that Signa would want to concentrate on its more lucrative operations, namely KaDeWe, while shedding weaker Karstadt doors. However, as one insider said in regard to KaDeWe, “The thought of a sale has often come up, but this time it could be more serious.”

“Our criteria is to acquire companies that provide us with synergies, cost savings, an opportunity to operate the business maybe better than the previous management and to have some real estate component,” Baker said during an earnings conference call earlier this month. “We have the capacity and financial capability to do a transaction at this time, but we are very careful and picky and relatively conservative. So we’ll see how it goes….Our focus is really on acquisitions in the luxury space, in the better, midtier space and in off-price. The quality of a brand is very meaningful to us.”

Baker has said HBC could “periodically” make some “large-scale acquisitions,” which could be in North America or internationally. “We look at department stores and businesses throughout the world that would fit in well,” he said. Neiman Marcus has been high on his list, though it would be impossible to buy considering it was purchased by Ares Management LLC and the Canada Pension Plan Investment Board for $6 billion in 2013.

Baker would not comment on KaDeWe.

KaDeWe, which opened in 1907, survived through World Wars I and II and The Depression. In the early Forties, a U.S. plane crashed into the building, which was renovated and reopened in 1950.