Turning Soviet Army Bases Into Suburbs : Germany: Thousands of people will flock to Berlin in the next decade as it becomes the seat of government. American firms hope to lead the way to new housing.

Hundreds of thousands of bureaucrats, diplomats and lobbyists will swell Berlin in the next decade as the once-divided city becomes the seat of Germany’s government at the heart of Europe.

But where are they going to live?

Aiming to protect the woods, lakes and meadows around the capital, German planners have hit on a solution that’s friendly to the environment and, potentially, to American businesses: Put some of the people on former Soviet Red Army bases--in American-style houses.

Thomas G. Blake, a 49-year-old American archivist, got to know the look and feel of the Soviet bases in the late 1980s, when he visited them as a civilian protocol officer at the U.S. Army’s Berlin Brigade.

Today, he’s leading an initiative to develop the bases in Brandenburg state next door to Berlin, in what could become one of the largest U.S. investments in former East Germany.

“America spent 45 years after World War II working to make Germany safe, and we’re looking to amortize that,” said Blake, a blond fireball whose fluent German and English are laced with military jargon and jokes.

“If we make a few bucks along the way, hey, that’s the way life goes.”

Blake and a partner have signed a guideline contract with Brandenburg state to clean and develop up to 25 Soviet military bases around Berlin.

Much of the land would be used for new housing. But first the bases--abandoned last August by the Russian army--have to be cleared of rusting bombs, mouldering barrels of chemical waste, and huge patches of spilled diesel fuel.

“We’re turning swords into plowshares, barracks into condominiums, toxic waste dumps into nature preserves,” Blake said, adding that the part about the nature preserves might be a bit of an exaggeration.

The bases are huge and mostly unencumbered by the ownership disputes, some dating to the Nazi years, that tie up other East German property.

Plus--as might have been expected for the Soviet army’s Western front--the bases have great road and rail links. Where Soviet tanks once clattered, supermarket produce trucks will roll in the future.

The 423 former Soviet bases in Brandenburg cover 4% of the state’s land area and are concentrated around Berlin.

Blake’s partner, military base cleanup expert R. William Mengel, estimated the project could bring an investment of at least $500 million in the coming 15 years.

Their company, R&D; Tec Inc., based in Abingdon, Md., stands to gain a chunk of an immense construction boom. They would manage and develop the properties for local communities, with help from planning experts at Clemson University in South Carolina.

Between 1991 and 2005, according to the federal Economics Ministry, approximately $1.7 trillion will be invested in construction in former East Germany, 41% of it in housing.

More than 300,000 new apartments and houses are expected to go up by 2005 in Berlin and Brandenburg.

Although many of the bases that Blake and Mengel would develop are up to an hour’s drive from Berlin, they are likely to become bedroom communities as the federal government and accompanying lobbyists, embassies and service industries move in by the year 2000.

Brandenburg officials were attracted to American house builders and their techniques.

Using modular parts and wood, rather than the steel and stone favored by German builders, American builders could knock up to 40% off the typical $245,000 price tag for a new two-bedroom house, said the state construction minister, Horst Graef.

Blake and Mengel expect to get use approval for the first three sites later this year, including a 22,200-acre former Soviet attack base near Kloster Zinna, 33 miles south of Berlin.

The value of that site would skyrocket if the government moves ahead this year with plans to build a massive new Berlin airport at nearby Sperenberg.

Major success stories are unusual for the 270 U.S. companies that have invested about $7 billion in former East Germany. West German firms have an edge in the administrative and legal framework that came with unification.

But Blake and Mengel have high-level support, which was evident at a business conference in Potsdam in July. They got Brandenburg’s government to invite former President George Bush.