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Luxembourg – Summer 2012

Professional Real estate

brought to you by

O

Summary Elise Building at a glance

p.1

Editorial

p.2

Our current offers

p.3-10

Key figures

p.11-13

Glossary

p.14

pp Ne or w tu ni ty

Our special feature: Focus on Elise Building

p.15-16

Contact Us REALCORP Luxembourg 22, Avenue Monterey, L-2163 Luxembourg Tel: +352 26 27 29 www.realcorp.lu

Non- contractual document p.1


Luxembourg – Summer 2012

Editorial To Buy or not to Buy, is that the question? … Or are there other options? Are you one of those who

office space in Sandweiler, which RealCorp helped

are thinking smarter in the current market? It certainly

them select as conveniently accessible from their

offers us many opportunities for creative thinking! The

existing Luxembourg offices.

basic goals of business—to maximise profit, to minimise costs, and to keep on growing— haven’t changed. But

To assist client representatives whose primary func-

the rules of the game have, or, at least, are in a state of

tion is not property management, but who are tasked

flux. This means that we need to consider options that

with or contributing to the effort to find appropriate

we haven’t tried before, compare several opinions and

office space, this newsletter introduces a Glossary of

take the right expert advice to sharpen our strategies

terms commonly used in Luxembourg commercial

and to increase the productivity of all existing assets.

property transactions. We hope you find this helpful, and we welcome suggestions for more definitions.

It also means that we need to value and motivate the people in our organisation even more, to empower and

Greg and Alain continue to search out and value

inspire them to pull together in that effort. One impor-

new development opportunities in Luxembourg.

tant component of staff morale is their physical working

Since we have grown our specialisation in Land &

environment. RealCorp has several properties for sale

Development, our sourcing capability is greatly ex-

and for rent which can inspire as well as facilitate pro-

panded. We now produce full financials and invest-

ductivity. As always, our newsletter brings you a sample

ment memoranda for financing, as well as critical

of our Current Offers (pp 3-9), more of which may be

Development Analysis, due diligence and appraisal

found via the Property page of our website.

reports. We anticipate significant joint ventures and strong mandates with landowners and investors.

This month we would like to draw your attention to the attractive Elise building in Leudelange. Our Feature arti-

As the summer approaches (however reluctantly!)

cle on pp12-13 explains the meaning and value of the

and children look forward to vacations, our thoughts

Luxembourg-specific Valideo certificate proudly sport-

inevitably turn to sun, water, and the lighter things of

ed by this environmentally friendly building. The Techni-

life. Wherever you are, geographically, in your busi-

cal Specifications include—amongst all the usual high-

ness, and in your personal life, I hope that August

spec requirements for a Luxembourg office space—a

brings you times of relaxation, reflection and new in-

central atrium, acoustic barriers, automatic blinds, rain-

spiration to drive the changes you would like to see.

water recovery, bicycle parking and changing rooms.

The RealCorp office remains open during this sea-

This is a practical office space with a feel-good factor

son and we’ve ensured that someone will always be

that could be just the key to maintaining morale and

here to discuss ideas and help you explore new pos-

motivating positive action in difficult economic times.

sibilities in property investment.

In the Key Figures section (pp10-11), our notes and graphs on commercial real estate Take-up reflect stabil-

Michael Chidiac Managing Director

ity in both Demand and Supply against Q2’s fairly grim economic context, which we summarise with supporting statistics from STATEC. We suggest some reasons for this stability and offer examples of the Q2’s transactions. One heartening example of both growth and intelligent strategy is the recent expansion of the LAB Group into 3638sqm of additional warehouse and 300sqm of extra

Non- contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.2


Luxembourg – Summer 2012

Current Offers N

To let

EW

Type: Office Area: 2059 sqm Div.: 396 sqm Availability: Immediate High-standard building, located on Bd. Royal. The premises are fully air-conditioned and benefit from good lighting and flexible floor.

Central Business District

ref.: 203555

To let

To let

Type: Office Area: 272 sqm Div.: Contact us Availability: Immediate

N

EW

Type: Office Area: 347 sqm Div.: N/A Availability: Immediate

Totally refurbished office/retail space on the ground floor of a building ideally located close to all amenities. Wide window display, public parking. Approx 63 sqm of archives.

High-standard offices in a topfloor duplex, in the pedestrian area.

ref.: 203451

ref.: 302259

C Lo en ca tra tio l n

To let Type: Office Area: 1072 sqm Div.: 200 sqm Availability: Immediate In a green setting, close to motorways and train station, these buildings offer several floors for office use, some with terrace. ref.: 204504

L av as ai t flo la o Type: Office bl r Area: 368 sqm e

To let

To let

Div.: N/A Availability: Q3 2012

New building, well-located, very high quality fittings, BREEAM certification, flexible floor planning, parking.

Type: Office Area: 2116 sqm Div.:N/A Availability: Sep-12 Independent building with atypical architecture, ideally located. The spaces are ideally fitted and offer good natural lighting.

ref.: 203490

ref.: 280749

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.3


Luxembourg – Summer 2012

Current Offers Id e to al w Pla or c k in e

To let Type: Office Area: 281 sqm Div.: N/A Availability: Q4 2012 Very good location, close to the train station, two separate entrances, open space to be partitioned, kitchenette. Parking available. ref.: 210655

Bourbon / Station

To let

To let

Type: Office Area: 3000 sqm Div.: 484 sqm Availability: Contact us

Type: Office Area: 1158 sqm Div.: 259 sqm Availability: Immediate

New building ideally located in front of the Station. The office and retail spaces are easy to fit and benefit from high standards.

Brand new building close to all amenities. The premises are well-arranged and in very good condition. Parking and archives are also available. ref.: 207633

ref.: 204107

L Flo as or t s

To let Type: Office Area: 308 sqm Div.: 97 sqm Availability: Immediate Brand new building located on the Plateau Petrusse, offering office floors of high standard, well-arranged and bright. ref.: 222621

To let

N

Type: Office Area: 748 sqm Div.: 145 sqm Availability: Dec -12

EW

Ideally located in the Bourbon area, this office building has good standards, and has been entirely refurbished.

To let Type: Office Area: 691 sqm Div.: 250 sqm Availability: Immediate In a renovated luxury building, we offer the rental of offices with high quality services.

ref.: 295372

ref.: 204005

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.4


Luxembourg – Summer 2012

Current Offers N

Gasperich / Howald / Leudelange

EW

Let by REALCORP To let Type: Office Area: 324 sqm Div.: N/A Availability: Immediate This high standard office building is very well located, and offers easily partitioned spaces which can be split from 10sqm. ref.: 288982

To let

To let

Type: Office Area: 1258 sqm Div.: 629 sqm Availability: Immediate

Type: Office Area: 5200 sqm Div.: 424 Availability: Immediate

In the Cloche d’Or area, we offer to let some office spaces organised over 2 floors, with good natural light, ideally located and close to public transport and Park & Ride parking.

Building located in Leudelange. Functional areas, fully wired, easily divisible. Services and amenities are very good and make it a great place to work. ref.: 207463

ref.: 275211

At

L av as ai t flo la o Type: Office bl r Area: 417 sqm e

tr Re act nt ive

To let

Div.: N/A Availability: Immediate New buildings, generous parking allowance, high quality standards, BREEAM certified.

ref.: 205508

To let

To let Type: Office Area: 610 sqm Div.: N/A Availability: Immediate This 4-storey building offers bright office spaces looking onto a large inner courtyard with trees and grass. A very quiet location close to all amenities.

Type: Office Area: 2549 sqm Div.: 233 sqm Availability: Immediate Bright and functional office space, divisible from 250 sqm, in an attractively converted industrial building of modern architecture.

ref.: 208267

ref.: 205166

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.5


Luxembourg – Summer 2012

Current Offers N

To let

EW

Type: Office Area: 2966 sqm Div.: 707 sqm Availability: Immediate At the heart of the tertiary area of the Findel Airport zone, a new and high standard building offers to rent office floors fully equipped for your needs. ref.: 206239

Airport / Kirchberg

To let

To let

Type: Office Area: 916 sqm Div.: Contact us Availability: Immediate

Type: Office Area: 851 sqm Div.: 62 sqm Availability: Immediate

Near to Auchan mall, this recent building has easy-to-fit and well-cooled spaces. Excellent parking ratio

Brand new high standard building close to Airport and its amenities. The lettable areas are full of natural light and can be easily partitioned. ref.: 217333

ref.: 279979

La

st

To let Type: Office Area: 461 sqm Div.: 83 sqm Availability: Immediate

Flo

or

Bright offices, well-finished and partitioned, in a building in a good location on the Kirchberg plateau. ref.: 217233

To let

To let Type: Office Area: 489 sqm Div.: N/A Availability: Immediate Modern building in the heart of the Kirchberg business district, near public transport and shops. Office spaces are of good quality and offer standard services.

Type: Office Area: 531 sqm Div.: 199 sqm Availability: Immediate Luxury building with high-quality services in the immediate vicinity of Findel airport and its facilities.The office spaces are conveniently arranged, perfectly soundproofed, and fully furnished.

ref.: 208265

ref.: 208700

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.6


Luxembourg – Summer 2012

Current Offers

Bertrange /Strassen / Capellen / Windhof

At

tra Re ct nt ive

To let Type: Office Area: 505 sqm Div.: N/A Availability: Immediate At the heart of the ZA Bourmicht in Bertrange, we offer for rent offices fully wired and cooled with numerous parking spaces. ref.: 207512

La Av st F To let ai lo Type: Office la or bl s Area: 2637 sqm e Div.: 400 sqm

To let Type: Office Area: 868 sqm Div.: 265 sqm Availability: Immediate

Availability: Immediate

2 floors of offices ideally fitted out and partitioned. The spaces are full of natural light and air-conditioned. Archive and parking upon request.

Ideal working environment located on Route d’Arlon. This HQE building ensures relatively low cost of common expenses.

ref.: 292283

To let

ref.: 204944

N

EW

Type: Office Area: 335 sqm Div.: 211 sqm Availability: Immediate

Building located a few meters away from motorways. The premises offer a kitchenette, archives, and parking, at a very attractive rent. ref.: 301227

To let Type: Office Area: 18876 sqm Div.: 292 sqm Availability: Immediate In the Bourmicht area, these 3 office buildings are designed to high standards with good modulation, great parking ratio and many useful services for its tenants (creche, restaurants…)

To let Type: Office Area: 5863 sqm Div.: 172 sqm Availability: Q1 2012 SolarWind building is focused on ecology and is the first triple-certified project in the world! It spreads over 10,000m² and offers wide and luminous offices.

ref.: 279649/ 279623/ 278967

ref.: 207027

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.7


Luxembourg – Summer 2012

Current Offers Liv an

Es

ch

ge

Periphery

To let

To let

Type: Office Area: 1809 sqm Div.: 237 sqm Availability: Immediate

Type: Office Area: 473 sqm Div.: 157 sqm Availability: Immediate

The recently completed building is located close to the A3 motorway to France. The premises are very bright and well-soundproofed and spread over 7 floors. Generous parking allowance.

Central location for this office building ideally fitted out. Offices may be either open space or partitioned. The Hotel de Ville parking and the Esch sur Alzette train station are close to the building.

ref.: 221809

ref.: 297841

M

Ha

un

m

sb

m

To let

ac h

To let

Type: Office Area: 245 sqm Div.: N/A Availability: Immediate

Type: Office Area: 1014 sqm Div.: 411 sqm Availability: Immediate

Ideally located between CBD and the Airport, this building of recent construction presents well-arranged office space which is easily divisible. Archives and parking available.

Comfortable and secure building ideally located in a green environment close to Kirchberg and Airport, easily accessible by public transport. Ernst & Young and Cetrel have chosen this place for their offices.

ref.: 205218

ref.: 278100

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.8


Luxembourg – Summer 2012

Current Offers U pp niq or ue tu ni ty

O

To let Type: Retail Area: 363 sqm Div.: 146 sqm Availability: Immediate Retail located in a recently refurbished building in the historical area of Luxembourg, in a pedestrian zone. Wide window display. ref.: 298959

To let

To let

Retail

Type: Retail Area: 525 sqm Div.: N/A Availability: Contact us

Type: Retail Area: 663 sqm Div.: 212 sqm Availability: Immediate

Totally refurbished Period Property, offering a great view of the Place Guillaume. The spaces are majestic, full of natural light, with a great ceiling height. Rare opportunity!

Several commercial areas in the ground floor of a building ideally located on the Boulevard de la Foire, some with wide window displays. ref.: 200981

ref.: 203216

Re

st au

To let

ra n

Type: Retail Area: 1631sqm Div.: 130 sqm Availability: Immediate

ts

Wide commercial area to be renovated, close to public transport. 2 entrances, stock in the basement accessible via elevator. ref.: 296924

To let

To let Type: Retail Area: 130 sqm Div.: N/A Availability: Immediate Retail with 11m of window display. The space is in a totally refurbished building close to the Station.

Type: Retail Area: 1000 sqm Div.: 500 sqm Availability: Contact us 2 brand new restaurant areas remaining in this building located in front of Luxembourg station, to be delivered by the end of the year.

ref.: 298343

ref.: 204107

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.9


Luxembourg – Summer 2012

Current Offers G

as

Liv an

pe

ge

ric h

Warehouse

To let

To let

Type: Warehouse Area: 3700 sqm Div.: N/A Availability: Immediate

Type: Warehouse + Offices Area: 2206 sqm Div.: 45 sqm Availability: Contact us

Within the Industrial area of Gasperich, an expanding zone, used warehouse and office spaces requiring minimal refurbishment.

Within the industrial zone of Livange, close to the A3 motorway, several used office and warehouse spaces available,requiring minimal refurbishment. Numerous external parking spaces. ref.: 294037

ref.: 287704

M

G

en

sd

re ve n

or

m

f

ac he

r

Let by REALCORP

To let Type: Warehouse Area: 3127 sqm Div.: N/A Availability: Immediate

Type: Warehouse Area: 900 sqm Div.: N/A Availability: Immediate

In Mensdorf industrial zone, warehouse fully adjustable and available at a very attractive rent.

Independent new building located in the industrial zone in Grevenmacher. The premises are ideally arranged for administrative and/or industrial (showroom?) use. Numerous parking spots in front of the building

ref.: 206988

ref.: 299195

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.10


Luxembourg – Summer 2012

Key Figures ECONOMIC CONTEXT Q2 • After a slight hiccup from November 2011 to February 2012, then stagnation recorded in Q1 2012, the market indicators reveal a fall in GDP for the 2nd quarter in the Eurozone (a decline of 0.2% to 0.3%). • The instability of the Eurozone, mainly due to differences of opinion on political solutions to the crisis, is likely to fuel the loss of business confidence. • The economic forecast for Luxembourg announces a year of weak growth in 2012 (around 1%) and a sluggish recovery in 2013 (around 2%). However, in light of the current economic downturn, it is likely that these forecasts will be revised downwards in the coming months. • The unemployment rate in Luxembourg has meanwhile reached 6% in May 2012, against 5.56% for 2011 (an 8% increase). • Q2 2012 is therefore suffering a decline in GDP growth and rising unemployment, confirming the STATEC scenario announced earlier this year. The real estate market could suffer short and medium term fallout from this. Even though take-up improved early in 2012, we should expect a slowdown or even a delay of projects, until the macroeconomic situation offers more visibility.

Quarterly variation %

Quarterly variation in points

Source : STATEC Eurozone : GDP and PMI

Eurozone GDP (percentage) Eurozone Composite PMI (points)

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.11


Luxembourg – Summer 2012

Key Figures DEMAND

How about take up Q2 tow ards last years? 200000

2011

180000 160000 140000

2010

SQM

120000 100000

2012

80000 60000 40000 20000 0

• The Q2 take-up comprised approximately 50,850sqm in 64 transactions, with an average of 794sqm per transaction—quite high, but affected by six big transactions of more than 3,000sqm, including:

• Société Générale Bank and Trust: 9,126sqm in Central Plaza building (Station area) • Université de Luxembourg: 8,627sqm in Richard Meier building (Kirchberg area)

LIMPERTSBERG OTHER

TRS

LIVANGE

SANDWEILER

WINDHOF

LEUDELANGE

OTHERS IT&TELECOM

ESCH HOWALD

SRV

CAPELLEN KIRCHBERG AIRPORT

GOV

CBD

STATION

BFI

This quarter’s transactions were largely by Banking and Financial companies (57%) which represent more than half of the total take-up, followed by Government and other administration (17%), Services for companies and industries (13%), and IT & Telecom (6%).

The most dynamic sectors for Q2 2012 were Kirchberg, Airport and Station, which registered a big progression due to several major transactions of more than 3,000sqm each. The Central Business District has been quite stable and is still in top position with the most transactions, among which was one of more than 4.000sqm.

The take-up of space in Q2 2012 was similar to that in Q2 2011.

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.12


Luxembourg – Summer 2012

Key Figures SUPPLY • In Q2, the vacancy rate reached 7.16%, representing

14%

approximately 237,000sqm of available space (+0.27

12%

points more than Q1 2012, i.e. the rate remained fairly

10%

stable). In the CBD, this rate only reached 2.5%, while

8%

in Kirchberg it reached 2.2%. These figures reflect that

6%

most available stock is located at the periphery of the

4%

City, e.g. Airport: 14.7%, Bertrange: 28%.

2% 0% 1

2

3

4

5

6

7

8

9

10

11

12

13

• 4 new deliveries are almost fully let:

• ADEM new headquarters (ESCH) —9100sqm fully let

• Stargate (CBD) —6600sqm: 368sqm still available

• Central Plaza (STATION) —13,000sqm: 4800sqm still available

• Solarwind (WINDHOF)—10,000sqm: 5700sqm still available

• There are two possible reasons for this stability. Firstly, good take-up (i.e. the large areas transacted) compensated for deliveries of new office space. Secondly, the available stock increased slightly as well, due to a few companies having left their premises and/or closed. This rise was offset by companies which extended their office space, such as:

- Société Générale Bank & Trust—9126sqm

- Franklin Templeton—2576sqm

- Orangefield—296sqm more in the same building 44 40 36 32 28 24 20 16 ER G

BD

CH

B

C IR K

T

LI M

PO R

PE RT

H IC

ER O

A

SP ER

G A

E

SS EN

ST R

A

NG

CH A

EL A D

E R

NS B

G A

U

LE U

B

M

LD ER TR A N G C E AP EL LE N

M AM H

O W A H

C

O N

TE R

N

12

• After rising over the past few years, rents seem to have stabilized since the end of 2011. Prime rent remains at 40€/sqm in the CBD.

• Landlords are still willing to consent to some incentives most of the time, for example, by granting rent-free periods depending on the duration of the lease, or by participating in the fit-out costs, leading to a decrease in economic rent. Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.13


Luxembourg – Summer 2012

Glossary

Availability

Total office space on the rental or selling markets

Economic rent

Rent calculated after deduction of all Incentives

Headline rent

Rent recorded in the lease contract

Incentives Inducements to future tenants, such as a contribution to fit-out works or a rent-free period New delivery

New buildings that were delivered during the quarter, whether already occupied or still available

Pipeline

Total of constructions expected to be delivered in the near future

Presentation rent

Landlord’s requested rent which is announced to the Lessee

Prime rent Highest value rent recorded for a high quality office unit in the best location during a specified period (after abnormal statistics have been eliminated) Take-up

Total office stock known to have been let, pre-let, sold or pre-sold

Total office stock

Sum of existing office space (buildings), either occupied or free

Vacancy rate Total vacant space offered for letting divided by total stock of space, expressed as a percentage

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.14


Luxembourg – Summer 2012

Feature AV AI

LA

BL

E

RealCorp offers you harmony and light in this attractive office building.

Elise in Leudelange An ideal workspace, Elise reveals an architectural and environmental concept t remarkable on several levels. In their project design, Linster Stupar Architects aimed for harmony. This is apparent in the layout of the work area which is divisible from 230 m², as well as in the exterior landscaping. An atrium and garden terraces offer building occupants attractive areas for relaxing and

refocusing during the working day. The high quality natural materials of the exterior fittings give Elise a particularly “green” aspect, including: • Driveway with eco-slabs or natural grass paving systems • Wire mesh gabions with stacked stone • Natural stone and concrete in the entry area • Eco-pavers, lawn, benches and planter boxes • Decorative lighting columns

Elise has been awarded a Valideo certificate. This green standard is a seal of certification for sustainable construction that assesses how a construction project may include respect for the environment, economy and society. Specifically adapted to the standards and regulations in force in the Grand Duchy of Luxembourg, the benchmark covers four themes: Construction, Management, Comfort and Social Value. It also takes into account the different stages of the life of a structure: Construction, Operation, Renovation, and Reassignment. VALIDEO is a guarantee of good environmental behaviour and adds value to any project certified.

The Location Address: ZI, Am Bann, L-3372 Leudelange Ideal for car access, Elise is only about 500m from the motorways, and 20km from Findel Airport. There is also excellent provision for cyclists, with bicycle parking & changing rooms.

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.15


Luxembourg – Summer 2012

Feature Remaining available space as at June 2012: Floor

Type

Sqm

3

Offices

700

3

Offices

700

2

Offices

234.54

2

Offices

951.08

Total

Offices

2585.64

Ground

Parking

55 bays

-1

Parking

52 bays

-1

Archives

212.09

-2

Parking

59 bays

-2

Archives

296.8

Technical Specifications The building benefits from high quality services, including: • Building services control system • Cooling in ceilings • Raised floors in wood or metal • Horizontal acoustic barriers between offices and corridors • ArGeTon® façades • Automatic exterior blinds with adjustable slats • Elevators • Rainwater recovery • Thermal insulation • Covered and open-air terraces • Central atrium • Reserved visitor parking • Bicycle parking • Changing rooms

Have a project, need advice or simply wish to visit ? Contact us

p.13

Tehdi-Edouard Babigeon

Jennifer Venne

Aurélie Vanaudenhoven

Head of letting & sales

Agency & research

Account manager

tebabigeon@realcorp.lu tel: +352 26 27 29 22 (Direct)

jvenne@realcorp.lu Tel: +352 26 27 29 34 (Direct)

avanaudenhoven@realcorp.lu Tel: +352 26 27 29 24 (Direct)

Non-contractual document

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29

www.rea lcorp .lu p.16

RealNews Summer 2012  

Review of Luxembourg Commercial Real Estate in Q2 2012, with a wide selection of current offers for sale or to rent.

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