The firm was pipped to the post by local practice ARGE, who landed the £12 million mixed-use development project in the heart of the Medieval city.
However, m2r did pick up a special prize for its proposed facade - made up of a mesh of wires - which paid tribute to Chemnitz's long history of clothmaking.
Describing the facade design, practice founder Axel Rostock, said: '[The textile shapes] were arranged in a pattern that not only follows the gradient of the sun but also had the advantage of changing the plasticity of the building in the urban context.'
The practice wanted to create a 20,000m 2retail-led scheme that would have incorporated a supermarket, a two-storey department store and several smaller retail units.
There were also plans for a 1,000m 2gym and health spa and a 6,000m 2office-space unit.