Last November it looked unlikely that mayor Klaus Wowereit, the man who coined Berlin’s unofficial “poor but sexy” slogan, would hold on to his job. After 10 years at the helm of a coalition of his Social Democrats and the Left party, he had a fight on his hands. Renate Künast, a Green Party heavyweight, had announced she was also throwing her hat in the ring and polls were predicting she could get 30%, enough to replace Wowereit and lead a Green-SPD government.

But several missteps and gaffes have seen Künast, a former federal agriculture minister, haemorrhage that early support. Her attempt to reopen a debate on the scope of the long-awaited Berlin-Brandenburg International Airport, currently being built on the city’s outskirts, and her suggestion of a 30km/h speed limit, were only two of the tone-deaf statements that damaged her credibility. And her insistence that she would stay in the city only if she became mayor did not endear her to Berliners.

Meanwhile the conservative CDU’s attempt to use a recent spate of arson attacks on cars to try to play the law-and-order card doesn’t seem to have dented Wowereit’s popularity. At the time of writing the SPD had managed to stretch a 10% lead on both the Greens and CDU. It now seems the only way for Künast to become mayor would be to align her party with the CDU, something that could be an interesting precursor to a possible similar coalition on a federal level two years from now.

Whatever the outcome, the new administration will be facing the same persistent problems as the old one. The city state still has massive debts, a stubbornly high unemployment rate of more than 13% – twice the national average – and an education system consistently rated the worst in the country. Even those with jobs are doing badly: the annual average wage of €16,000 is well below the national average of €19,000.

Meanwhile, the rising rents and gentrification in many districts could undermine the city’s attraction to the creative types whose presence is an important part of its appeal.

There are, however, success stories. The Adlershof science and technology park to the east and the biomedical hub in the northern suburb of Buch are signs that things are moving on the peripheries of the city. Berlin is also an important tech start-up hub. And when Tegel Airport closes next year, it will open up another possible cluster location.

The capital is also finally on its way to developing an infrastructure suited to the needs of a capital city. The new airport, which Wowereit has promised will create 40,000 jobs, is slated to open next June and both the SPD and CDU support the extension of the A100 motorway south-east of the city.

The challenge for Berlin’s new government will be to hold on to the sexiness, while ditching the poverty once and for all.