Madsen, an independent, claimed about 57 percent of the vote in a run-off ballot in the northern city, beating Steffen Bockhahn of the far-left Linke with around 43 percent.
Copenhagen-born Madsen, 46, has lived in Germany since 1992 and settled two decades ago in Rostock on the Baltic Sea. However he has never taken a German passport.
He has led the local chamber of commerce for six years and ran a campaign promising “pragmatic” politics and a strong ecological stance.
Madsen was able to maintain his lead from the first ballot three weeks ago when he won 34.6 percent of the vote against eight other candidates, while Bockhahn won 18.9 percent. The second round was held because no candidate received more than half of the votes.
'Stuck in the past'
As The Local reported, Madsen's campaign was based on modernizing Rostock, a harbour city on the Baltic Sea coast which he said was “stuck in the past”.
He pledged to make the city more attractive for companies in other countries around the Baltic Sea, including Denmark and Sweden.
That would be achieved through renovation of the harbour, improving public transport and bicycle lanes, and making the city a climate frontrunner through a series of environmentalist initiatives, according to the Danish candidate’s platform.
Madsen also said he wanted to build a new theatre in Rostock.
Madsen, who sports a prominent beard and sharp business suits, had pledged to hand over management of five furniture stores he owns to his wife should he be elected.