Filmmakers spent $3 billion in the area in 2009

It turns out poverty is a virtue for Berlin, Germany’s least-wealthy big city that has become a fertile filmmaking center.

The city’s low cost of living and huge pool of creatives, combined with strong subsidies, nearly doubled coin spent on production last year from 2007.

A record E2.3 billion ($3 billion) was spent on more than 300 German and international co-productions in Boom Town Berlin and the surrounding state of Brandenburg in 2009 — nearly double the $1.5 billion of two years earlier. Subsidy org Medienboard Berlin-Brandenburg says the number of days of filming tripled to 2,100 last year from 750 five years ago.

“Berlin has turned into a really exciting city for making films,” says German filmmaker Til Schweiger, who returned to Germany in 2004 after seven years in Hollywood. He set up his Barefoot films shingle in Berlin’s Prenzlauerberg district, the Bohemian quarter in the formerly communist east. “A lot of the most creative people around the world are coming to Berlin. It’s probably the cheapest big city you can find anywhere in the world.”

Subsidies from the government’s German Film Fund (DFFF) and the local Medienboard Berlin-Brandenburg have played an important role in the dynamic growth, helping lure international co-productions such as “Hanna,” a thriller starring Cate Blanchett, “Anonymous” by Roland Emmerich and “Unknown White Male” with Liam Neeson that are being filmed at Babelsberg this year. Also in the works are “Chicken with Plums” with Isabella Rossellini, and Paul W.S. Anderson’s “The Three Musketeers” starring Christoph Waltz.

But the city with the one-of-a-kind history (think Kaisers, Nazis, Communists and Berlin Wall) has developed a reputation as a “blank canvas,” as a pulsating party town and magnet for creatives from around the world — thanks in part to its astonishingly inexpensive cost of living. There are an estimated 25,000 artsy expatriates living in Berlin from across Europe, Asia and North America, according to Berlin think tank DIW.

“New York might once have been the ‘melting pot’ of international creatives but now it’s definitely Berlin,” says Stefan Arndt, topper at X-Filme. Kirsten Niehuus, topper of the Medienboard Berlin-Brandenburg, agreed: “Berlin-Brandenburg has become an incredibly popular location for both German and international filmmakers.” Her org has become a leading player in local and international film productions in recent years — it invested a record $38.3 million last year in 222 film projects.

Films made in Berlin helped German pics maintain 27.4% of the domestic box last year, beating the previous best of 26.6% in 2008. Quentin Tarantino’s Oscar-winning “Inglourious Basterds” was filmed at Babelsberg with German coin”The Reader” also filmed at Babelsberg with German backing, and Michael Haneke’s “The White Ribbon” was made in Germany with Teuton coin. Other international co-productions made in Germany with Teuton funding include United Artists’ Tom Cruise starrer “Valkyrie” and Warner Bros.’ “Speed Racer.”

Berlin was long deprived of any sort of industrial base, which kept real estate prices and wages down. But the city, with its population of 3.4 million, has managed to turn its ridiculously low costs into a virtue.

More than 15,000 people work in the film sector in Berlin and Brandenburg at more than 1,300 companies. Besides Babelsberg, Berlin has more than 50 studios, including Media City Adlershof, CCC Studios and Union Film.

An important cornerstone of Berlin’s most recent success is the German Federal Film Fund (DFFF). Berlin Mayor Klaus Wowereit says the DFFF has helped Berlin pull away from rival film centers such as Munich and North Rhine-Westphalia. The $80 million-a-year fund has spent more than $383 million on films since it was set up in 2007, and offers grants of up to 20% of a film’s budget, provided enough of it is spent in Germany. That has led to more than $1.5 billion being invested in more than 300 pics.

German Culture Minister Bernd Neumann has pushed through an increase in the DFFF, and says he has been delighted by the return on investment. Chancellor Angela Merkel went out of her way to meet Hollywood executives on a trip to the U.S. earlier this year. “You can’t underestimate the importance of the film industry as a sector of the economy,” Merkel said.

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