Flanders office market performing wellOFFICES
Having recently reported on the state of the Walloon office market, it is now the turn of Flanders to come under the spotlight. Real estate advisor Cushman & Wakefield has produced a report analyzing the performance of the Flanders office market during the first quarter of 2023.
Cushman & Wakefield starts by saying that Flanders has witnessed a strong first quarter in 2023. Take-up has been resilient compared to other regions. The take-up for the quarter stands at 50,440 m². Taking a closer look at individual cities, Ghent has been characterized by fewer transactions (18) but witnessed its highest take-up since more than ten years. The notable transaction in the Regional office market is indeed in Ghent – the renewal of Zuiderpoort with its 20,575 m² to its new tenant, the State Buildings Agency (Régie des Bâtiments). In Antwerp, 4,585 m² were taken up by Trescal in the Nijverheidsstraat.
Prime and average rents increase in Flanders, C&W goes on to say. Prime rents have followed the trend of the overall Brussels office market and have thus not increased in the first quarter of 2023. The prime rent for Flanders remains at € 170/m²/year (compared, for example, to Wallonia at € 160/sm²/year). Fast-forwarding to the end of 2023, C&W expects to see prime rents increase due to the demand for high-quality offices. The Weighted Average Rent has increased to € 133/m² /year in Flanders. On a city level, Ghent has seen the greatest impact due to its stronger occupier market. It witnessed an increase from € 137/m²/year in 2022 to € 144/m²/year in the first quarter of 2023.
The pipeline in Flanders remains strong, with new deliveries in the first quarter of 2023 standing at 11,000 m². These new deliveries are Zuidpoort G in Mechelen for 6,200 m² and Arto in Antwerp for 4,800 m². Together with the strong take-up, the market seems favorable for 2023. In the following quarters in 2023, 78,000 m² is expected to be delivered. In Ghent, 47,200 m² is in the pipeline. This consists for example of 18,000 m² in Upoffiz, 9,500 m² for the Vlaams Instituut van Biotechnologie and 5,000 m² in Keizerpoort. In Antwerp, Montevideo will be delivered and provide 10,195 m² of office space. Between 2024 and 2030, 275,000 m² of office space is expected to be delivered, of which 129,400 m² in Antwerp and 43,300 m² in Ghent. Mechelen and Leuven together will see 101,900 m² of new office space. Some notable deliveries are Bioscience Toren (27,000 m²) in Leuven and MALT (17,900 m²).