M A R K E T B E AT
BELGIUM REGIONAL Office Q4 2020
YoY Chg
12-Mo. Forecast
Overview Belgian GDP posted a 6.7% drop in 2020. In the first quarter of 2021, economic output should rebound by 2% on a quarterly basis, thereby returning rapidly to the level reached just before the second lockdown. At this point, the remaining restrictions, such as those for arts, recreation and events or, more generally, the required social distancing, will continue to weigh on activity. Source: National Bank of Belgium
269K Take-up sq m (2020)
165
Occupier focus
Prime rent, (EUR/sq m/year)
Prime yield (3/6/9 lease)
Flanders take-up decreased dramatically by 39% in 2020, to total 142,000 sq m – its weakest year since 2011. Q4 take-up was 53,000 sq m. Part of the issue, particularly in Antwerp, may be related to the reduced speculative deliveries in 2020. In contrast, Wallonia take-up in 2020 amounted to 127,000 sq m, registering a 41% growth in the process, with 38,000 sq m in Q4. This includes 78,000 sq m of take-up in Namur, which makes it Belgium’s second market in terms of take-up ahead of usual frontrunner, Antwerp. This upward trend was achieved through a substantial increase in the size and number of deals – attributable in particular to the Regional administration’s new occupational strategy. Prime rents remain stable at EUR 165/sq m/year in Antwerp, and EUR 160/sq m//year in Ghent, Liège and Namur
ECONOMIC INDICATORS Q4 2020
Investment focus
5.25%
GDP Growth Belgium
EUR 650 million have been invested in regional markets in 2020, this is the highest total since 2006, and includes EUR 127 million in Q4 (exclusively investments in Antwerp). Wallonia recorded its second highest volume of the decade (EUR 60 million), while Flanders registered its best year since 2006 with EUR 590 million. Highlights from the year include the purchase by AG Real Estate of several buildings at Post X in Antwerp (+- EUR 275 million), as well as Union Investment’s acquisition of the Diamond in Ghent, and Belfius’ acquisition of MG Business Center (EUR 45 million), also in Ghent. Underscoring the influence of these deals, the prime yield in Antwerp and Ghent sharpens to 5.25% in Q4.
5.6%
Outlook
Belgium Unemployment Rate
We expected prime yields and rents to remain stable in 2021. The pandemic puts a dampener on the private sector to kick on in 2021, globally we expect occupier demand to remain subdued.
YoY Chg
-6.7%
0.4%
12-Mo. Forecast
Belgium Consumer Price Index
TAKE-UP, SQ M
INVESTMENT VOLUME PER REGION, EUR M
400,000
800
35 30
Source: National Bank of Belgium
300,000
600
25 20
200,000
400
100,000
200
0
0
15 10 5
2016
2017
Flanders regional markets
2018
2019
2020
Wallonia regional markets
0 2016 2017 2018 Flanders regional markets # deals (RHS)
2019 2020 Wallonia regional markets