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| Brussels sees boost to office market in H1 2013 The Brussels office market has seen a rise in take up during H1 2013 with a 21% recorded increase year on year according to Savills. The firm predicts that in the area of Quarter Leopold, which accounted for 45% of transactions, the remaining available space could be let within 2.6 years, if such levels of demand continue combined with extremely low levels of supply. Prime letting transactions took place at €295 sq/m/year for best located assets. In terms of the overall vacancy rate, levels currently stand at 9.5%, compared to 10.5% in 2012, with decentralised locations at closer to 15%. The vacancy level in the Leopold District, home to the EU institutions, currently stands at 5.6% which has almost halved from its top levels of 11.7% in 2010, according to Savills data. The international real estate advisor expects that if the economy continues to recover in 2014-15, the trend of increased take up and decreasing vacancy levels could accelerate in the Leopold District. This district has been the most active area of the city with European Parliament pre-letting of 40, 555 sq m at Square de Meeus 8 representing the largest transaction in H1 2013. Gregory Martin, Managing Director at Savills Belux, says: "During the last three years the occupier market in Brussels CBD, particularly in the Leopold District, has consistently grown every year and a resulting lack of supply of new premises is becoming more and more apparent." Savills suggests demand is most strongly driven by corporates who account for 71% of overall lettings, whilst European administration departments share is closer to 27%. Total take up for H1 2013 reached 214, 000 sq m. In terms of the investment market in Belgium, whilst the transactional market was slow to start, total turnover reached €1.23 billion in H1 2013 which is marginally up from 2012 by 6% largely boosted by the €300 million Belair transaction equating to 24% of the market. Office assets were the most popular at 67% of the overall share, dominated by Belgium buyers at 60% of volume and German parties at 38%. Gregory Martin comments: "Demand for well let prime assets in Belgium remains strong. Due to the current scarcity of these assets, low long-term interest rates and improving prospects, prime office yields have moved in during the first half of 2013. Prime buildings in Brussels with standard three, six and nine-year leases are now trading at 6%, a contraction of 25bps on the last quarter of 2012, and could even contract further in the coming months with ongoing pressure due to demand outstripping supply." write your comments about the article :: © 2013 Construction News :: home page |