A two metre barrier has been erected around the Brandenburg gate to keep out people without tickets for the show.
The U2 show is part of the MTV Europe Music Awards, which take place later.
Ten thousand tickets were given away free online and snapped up within hours.
Now police in the city say they're expecting as many as 100,000 people to descend on the square in front of the Brandenburg gate to try and catch a glimpse of U2.
Mr Henkel, Christian Democrat floor leader in the Berlin city-state parliament, said: "It would have been so much better if as many Berliners as possible could have taken part.
"We don't know who's responsible for this, whether it's U2 or MTV.
He continued: "10,000 people is a lot, but U2 could have had an even bigger audience enjoying their music at this wonderful location."
U2 manager Paul McGuinness said Berliners think it is "pretty ironic" that an event to mark the falling of the wall has resulted in another one being constructed.
Fans, too, were displeased.
"It's completely ridiculous that they are blocking the view," said Louis-Pierre Boily, a Canadian fan who travelled to Berlin despite failing to secure tickets for the show.
"I thought it's a free show, but MTV probably wants people to watch it on TV to get their ratings up," he added.
Berlin politicians had previously dissuaded US President Barack Obama from visiting the city as part of the celebrations, for fear his security operation would require several main roads be blocked off.
It is now feared road blocking will be necessary to accommodate U2's fans.
Calls to representatives of U2 and MTV seeking comment have not yet been returned.