In the 19th century, Luckenwalde emerged as one of Germany's most important centres of hat production, benefiting from its established textile industry.
The origins of the factory can be traced to the Steinberg company, which began as a textile producer in 1844 before expanding into hat manufacturing in 1870. At the turn of the 20th century, Steinberg and the Herrmann company were the town's principal competitors. After Gustav Herrmann met the rarely unknown architect Erich Mendelsohn in 1919, the collaboration led to several commissions. When the two companies merged in 1921, they decided to consolidate production in a newly planned factory complex. The owners of the company were Felix Steinberg, Robert Steinberg Jr., Gustav Herrmann, and Felix Wülfing. Mendelsohn started in the same year with the plans for the building.
Work on the new facility began in 1922, and manufacturing was transferred there in 1923. Although the original plans envisioned a more extensive complex, the final stage of construction was never realised, leaving some production processes in the older factory buildings until the business closed in 1935.
The company's history was profoundly affected by the political changes of the 1930s. Following Gustav Herrmann's death in 1932, the Jewish-owned enterprise was expropriated and forced into a sale under the Nazi regime. The premises were subsequently adapted for military production, and the distinctive roof of the dyeing hall was demolished.
After the Second World War, the site was used by the Soviet Army for tank repairs. In 1957, production with different things went on and the former boiler and turbine house was adapted for workshops and offices. Already in 1976 the complex was declared a cultural monument.
The factory's cultural and historical significance was officially recognised in the late 20th century through heritage protection. Since the late 1990s, restoration initiatives have stabilised and repaired key parts of the complex, including the reconstruction of the dyeing building between 2006 and 2011. Although much has been preserved, the site has yet to secure a sustainable long-term use and today remains largely unoccupied.