Investment volume set to fall

Tim Harrup

Within the context of the uncertain economic situation, real estate advisor CBRE has carried out a survey in to the intentions of investors for 2023 within the Belgian market. The Investor Survey was designed by CBRE Belgium in order to provide in-depth insights into investor sentiment and planned capital allocation. The Survey is based on a comprehensive questionnaire completed by 35 national and international developers and investors in the months of December 2022 and January 2023.

The 2023 CBRE Belgium Investor Survey reveals that the questioned investors plan to allocate € 4.7 billion into Belgian commercial real estate investment in 2023, well below the € 9.0 billion that was available at the start of 2021 and the € 6.0 billion that was planned for 2022. This means that economic uncertainty, inflation and higher interest rates are likely to lead to less capital allocation and, eventually, investment volume in 2023. At the same time, the survey shows that investors will divest around € 4.3 billion of their current holdings, in line with previous years. Of the respondents, 66% are expected to be net buyers while the rest are expected to be net sellers.


Almost half (45.7%) of all planned commercial real estate investments in 2023 is likely to be in offices. Office space is thus once again the preferred investor asset in 2023, at €2.15 billion and well above last years' allocation of €1.83 billion. The re-emergence of offices as the top investment product in Belgium encapsulates the acyclical nature of Brussels’ public and private sectors and the position of long-term cashflows with full indexation as the ideal investment product in today's economy.

Logistics was last year’s investor favourite, and now drops back to second place with a planned allocation of €1.55 billion. Industrial and logistics space therefore remains extremely popular among investors. Although lower than last year, around €600 million of investor funds could find their way into residential investment in 2023. Commercial investors plan to spend €200 million on retail in 2023. There is indeed increasing interest for retail following high-profile deals in 2022. Building on positive occupier dynamics and key assets coming to market, 2023 is likely to be a good investment year. The capital allocation for senior living, hotels and alternative real estate could be somewhat lower in 2023.

Risk and ESG

In general, CBRE concludes, investors are less keen to take on risk in comparison to last year. The three main sorts of risk that investors are willing to accept in 2023 to increase possible exit gains are vacancy risk, development risk and the acquisition of older buildings. Geographical diversification, forward funding and other property types are the least favorite ways to increase the rate of return on real estate investments.

ESG compliance also remains top of mind for European investors, despite the more challenging investment landscape. Commercial real estate investors pay a lot of attention to the environmental aspects of real estate. A vast majority of investors affirmed that they would continue to apply ESG criteria to all investment decisions. The most popular ESG strategy is to upgrade existing assets to meet the standards of sustainability certifications. Additionally, one-third of investors surveyed stated that they were willing to pay a premium to acquire ESG friendly assets.