<
You are here : HOME > NEWS > Rents rising more slowly

Rents rising more slowly



Broker JLL has released its ‘European Office Property Clock’ for the second quarter of the year. This shows how major office markets are performing within the rental level cycle (Rental growth accelerating / rental growth slowing / rents falling / Rents bottoming out).

Brussels and Luxembourg are both in the quartile of ‘rental growth slowing’. Here they are in good company including London West End, Frankfurt and Amsterdam. The other critical western European market, Paris CBD, is now right at the frontier of ‘slowing’ and ‘falling’.

Speaking of our two domestic markets, the Office Clock says: ‘Vacancy in Brussels CBD plummeted to an all-time low of 3.3% in the second quarter, prime rents and average rents rose accordingly to all-time highs of respectively € 315 and € 167/m²/year. The scarcity of high quality buildings being available in the best locations is in favour of landlords that could require higher rents for their projects.
Luxembourg is currently in a similar situation of shortage of Grade A properties, at city level 3.6% is vacant and conditions are clearly in favour of landlords. Rental values have stabilised at their peak of €50/m²/ month, but there is a pressure for growth at €52 or above along the Boulevard Royal’.

For those not familiar with the difference in rental levels between Brussels and Luxembourg, a simple piece of arithmetic shows that Luxembourg is, quite simply, twice as expensive as the European capital.

Taking a look at the wider picture within which our domestic markets operate in this increasingly globalised world, JLL states that European office take-up amounted to around 3.2 million m² in the second quarter of 2019, representing a 5% year on year decrease. Nevertheless, European office vacancy decreased by 20bps to 5.8% over the period – the lowest level since 2002. European office rental growth is forecast to be around 1.7% per year on average over the next 5 years.
Tim Harrup
22-10-2019


News in short
Souverain 25 officially sold | 15/11
New last mile facility near Ghent | 14/11
People and Brussels top ULI discussion | 13/11
Phicap makes second acquisition | 12/11
Real estate: what the market thinks - ULI | 7/11
Tikehau comes to Brussels with a bang | 5/11
Beaulieu set for renovation | 4/11
Bouwmeester heads for the country | 30/10
PSA takes citydev building | 29/10
WeWork cash injection | 28/10
Phicap and Amirato come together | 25/10
Waste - a thing of the past | 23/10
Rents rising more slowly | 22/10
City 2 prepared for the future | 18/10
Street art in context | 17/10