M A R K E T B E AT
BELGIUM Industrial Q1 2022 YoY Chg
12-Mo. Forecast
235 (L) 233 (SI) Take-up (YTD) (000s sq m)
60 (L) 63 (SI)
Overview The Belgian economy is forecasted to grow 2.67% in 2022. This is expected to slow down and stabilise at 2.17% for the next two years and slow down further to 1.11% in 2025. This growth is associated with an increase of the employment rate. The unemployment rate decreased to a level of 5.49% in the first quarter and should be expected to decline further and stabilise around 5.21% by the end 2022 and 4.94% in 2023. This is due to a lot of people who had been temporarily unemployed and have returned to the workforce in early 2022. Energy prices continue to increase on the back of the invasion in Ukraine. This, combined with the fact that consumer spending is set to increase after a record year of saving, means inflation continues to rise and is forecasted at 8.22% for 2022.
Occupier focus
Prime rent, (EUR/sq m/year)
Semi-industrial take-up amounted to more than 230,000 sq m over 174 deals in Q1, a decent start to the year, especially considering the supply issues this market is facing. Indeed, apart from some small units in parks in the periphery of villages, larger units of a few thousand square metres are increasingly complicated to find. Owner-occupier deals constituted 52% of take-up this quarter. Demand for logistics spaces was within its quarterly average with a total of 228,000 sq m, with very strong demand recorded in Flanders where deals were large (over 10,000 sq m on average) and numerous. Occupier demand has been dominated by supply chain providers, on the back of the news that Belgium recorded the strongest growth of e-commerce companies in Europe according to a recent Eurostat ranking, while Belgian e-commerce sales increased by EUR 2.9 billion in 2021 according to Safeshops.be. This is demonstrated in Q1 by Amazon’s long-awaited arrival in Belgium at Montea’s Blue Gate project. In real estate terms, demand for last-mile facilities remains high and developers and occupiers will increasingly need to consider multistorey facilities, despite their higher cost. Prime rents in both segments remain stable: EUR 63/sq m/year for semi-industrial, and EUR 60/sq m/year for logistics.
4.00 (L) 5.80 (SI) Prime yield (%, 3/6/9 lease) L: logistics SI: semi-industrial
ECONOMIC INDICATORS Q1 2022 YoY Chg
2.67% 2022 GDP Growth
5.49% 2021 Unemployment Rate
12-Mo. Forecast
Investment focus An outstanding EUR 547 million have been invested in industrial assets in Q1, including EUR 441 million in logistics. This is on the back of two key deals in the sector, spearheaded by Montea’s agreement to cooperate with Cordeel to develop 230,000 sq m of sheds, worth EUR 235 million. Baltisse’s acquisition of Dematra’s high-bay warehouse in East Flanders for EUR 75 million is notable for its sheer volume, but also another significant foray into the industrial sector by a player not traditionally linked to this market in the past – such is the interest in industrial real estate currently. Logistics prime yields remain stable at 4.00% , as do semi-industrial prime yields at 5.80%.
Outlook Rents will increase and yields will sharpen, such is the demand in semi-industrial and logistics, against a backdrop of supply and labour shortage and increasing costs of energy and materials.
8.22% Consumer Price Index
INVESTMENT VOLUME PER TYPE, EUR M
TAKE-UP, SQ M
Source: Moody’s Analytics, BNB, Eurostat, March2022
3,000,000
Please note the economic data can vary significantly from one source to the other. Therefore, the figures provided should merely be used as an indication or trend.
2,000,000
800
50
600
40 30
400 20
1,000,000
200 0
10
0 2018
2019
Logistics
2020
Semi-industrial
2021
Q1 2022
0 2018
Logistics
2019
2020
Semi-industrial
2021
Q1 2022
# deals (RHS)