MODEST GROWTH FUELED BY PUBLIC & CORPORATE INVESTMENT
Belgium’s GDP growth for 2025 is projected at 0.84%, slightly below the Eurozone average of1.02%. In the first quarter, economic growth was primarily supported by fixed capital formation from bothpublic authorities and private enterprises. In contrast, household investment exerted adampening effect and the decline in exports, linked to the recent U.S. tariff measures and associated uncertainty, further constrained growth.
Amid slowing economic activity, unemployment is expected to rise slightly to 6.37% in 2025, driven mainly by unemployment in the industrial sector. However, a recovery in employment is expected in 2026,supported by theplanned reform of the unemployment benefit system, which aims to enhance labour market participation.
EUROZONE HITS INFLATION TARGET
In June 2025, Eurozone inflation alignedprecisely withthe ECB’s 2.00% target and is expected to remain stable throughout the year. Following the recent phase ofpost-pandemic inflation, the ECB has announced a strategic shift, aiming to incorporatea wider range of risk scenarios into its policy framework. The ECB also notes that companies have become more agile inadjusting prices, enabling faster responses to potentialglobal shocks and events.
In contrast, Belgian inflation remains elevated at 2.8%, primarily due to rising costsfor service vouchers and public transportation.A gradualeasing towards 1.8% is forecasted by the ECB in2026.
MONETARY POLICY AND FISCAL DEVELOPMENTS
Withinflation back on target, the ECB cut key interest rates for the eighth consecutive time in June 2025. As a result, interest rates continue ona downward trajectory, while government bond yields have remained relatively stable. Financial marketshave responded with renewed calm.
At the national level, coalition partners have reached an agreement on theintroduction of a capital gains tax. Capital gains on financial assets held by individuals will be taxed at 10% with reduced progressive rates, marking a significant shift inthe country’s fiscallandscape.
Source: Moody’s Analytics (baseline scenario - July 2025)
Source: European Central Bank (ECB)
BELGIUM
DEMOGRAPHIC SHIFTS AND THEIR IMPACT ON THE LIVING MARKET
As of January 2025, Belgium’s population reached 11.8 million, reflecting a 0.53% year-on-year increase, entirely driven by migration. Birth numbers dropped to their lowest level since 1942, and natural growth turned negative for 2024. Brussels remains the only region with positive natural growth and records the highest migration relative to its population, reinforcing its central role in future housing demand.
Between 2020 and 2025, the 20–24 age group, used by as a high-level reference for the student-age population, grew by 3.4%. In contrast, the 100+ age group increased by 77%, underscoring a rapidly ageing population. Additionally, 36% of households are now single-person, a share projected to rise, particularly among individuals aged 67 and older These demographic dynamics are reshaping housing needs, with implications for student housing, senior living and multi-family formats, especially those targeting smaller, flexible units.
RENTAL GROWTH IN MULTI-FAMILY CONTINUES AMID REGULATORY HEADWINDS
The multi-family market in Belgium continues to show a steady rental growth, with Brussels-Capital and Flanders almost on par with the health index growth. In Brussels, new rental regulations introduced in May 2025 cap rents at 20% above reference values and allow tenants to contest “overrented” units, adding uncertainty for investors.
An investment volume of €56.4 million has been recorded year-to-date across five deals. Notable transactions include Home Invest’s acquisition of Jardin Léopold, Quares Residential Investment’s purchase of Mench Industry in Schaerbeek and Buysse & Partners’ acquisition of Résidence Palace.
A pending landmark transaction is Home Invest’s agreement in principle with Cityforward to redevelop nine former EU buildings in Brussels’ European Quarter into 800 residential units under long lease rights. The deal is subject to permitting and due diligence Gross initial yield expectation is above 5.00%.
Prime yields for stabilized multi-family assets remain at 4.00%
SILVER SECTOR FACES SOFTENING YIELDS AMID STRATEGIC MERGER
The senior housing segment is experiencing a muted investment climate, with year-to-date volume totaling €26 million, driven by the transaction of Édition Zoute in Knokke. The asset currently has a function as an assisted living facility, but its potential redevelopment into residential complex emphasizes the blurred lines between care and mainstream living segments for this deal.
OUTLOOK
• Belgian GDP growth is forecast to slow to 0.78% in 2026, before bouncing up again to 2.22% in 2027.
• Inflation is expected to decline to 1.8% in 2026, which may ease cost pressures and improve overall market sentiment.
• Ageing population and growing share of singleperson households will shape demand for care and compact housing formats.
• Rental growth of apartments expected to continue because of the high demand for quality living units, especially in Brussels and Flanders, though regulatory risks in Brussels may slow investment appetite.
• The proposed acquisition of Cofinimmo by Aedifica could create a Belgian-based global leader in senior housing, reinforcing their position among the sector’s top international players.
• High occupancy of student complexes and rising student numbers continue to support the student housing market, despite limited deal flow.
3rd
Strategically, the senior living sector is undergoing significant transformation with Aedifica’s announced intention to acquire Cofinimmo, uniting Belgium’s two leading listed nursing home platforms under one group. Both companies remain internationally active: Aedifica recently acquired an oncology centre in Ireland and invested in two nursing home developments in Finland, while Cofinimmo is actively streamlining its portfolio through divestments in Germany and the Netherlands, while also expanding in Finland by acquiring two care projects.
Although domestic deal activity remains limited, prime yields are set around 5.15%, with sharper pricing observed in Flanders, while Brussels and peripheral markets continue to trade at elevated levels.
STEADY DEMAND, LOW VOLUME: STUDENT HOUSING DRAWS SELECTIVE INTEREST
The Belgian student housing market continues to show high occupancy and strong structural demand in major university cities. However, investment activity remains limited, with a total year-to-date volume of €21.6 million This includes Xior’s €2.6 million divestment on Paardenmarkt in Antwerp and the redevelopment project by LIFE and Quares Student Housing at the Erasmus University College in Jette, estimated at a total investment budget of € 19 million. The return of Quares Student Housing marks a renewed institutional interest in the sector, which remains largely dominated by listed Xior Student Housing.
The prime yield holds at 5.00%, though based on scarce transactional evidence.
ANNECHIEN VEULEMANS MRICS
Associate I Research
DEFINITIONS
• Investment volume: total capital allocated by professional investors in the living sector, including both completed transactions and committed projects, where investment budgets have been secured as part of an incomegenerating strategy.
• Prime yield: consistently achievable gross initial yield for a grade A asset in a prime location. In senior housing, this typically assumes a long lease to a strong operator, while in multi-family and student housing, it is based on stabilised occupancy without covenant weighting.
JONATHAN DECREM
Senior Advisor I Capital Markets
Tel: +32 (0)473 12 78 81 jonathan.decrem@cushwake.com
EMERIC INGHELS MRICS
Partner I Valuations & Advisory Tel: +32 (0)477 50 78 61 emeric.inghels@cushwake.com
Tel: +32 (0)476 83 54 09 annechien.veulemans@cushwake.com ©2025 Cushman & Wakefield. All rights reserved. The information contained within this report is gathered from multiple sources believed to be reliable. including reports commissioned by Cushman & Wakefield (“CWK”). This report is for informational purposes only and may contain errors or omissions; the report is presented without any warranty or representations as to its accuracy.
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