Real estate investment in Belgium reached a record EUR 2.3 bn in the first half 2007, up 35% on the year-earlier period, according to figures released by Jones Lang LaSalle on Tuesday. In Luxembourg, total investment has so far reached a record EUR 1.5 bn, compared to the record EUR 1.23 bn for 2006 as a whole. Increased demand for retail and warehousing, as well as sizeable portfolio deals, have kept the investment market buoyant in Belgium, JLL said.
Real estate investment in Belgium reached a record EUR 2.3 bn in the first half 2007, up 35% on the year-earlier period, according to figures released by Jones Lang LaSalle on Tuesday. In Luxembourg, total investment has so far reached a record EUR 1.5 bn, compared to the record EUR 1.23 bn for 2006 as a whole. Increased demand for retail and warehousing, as well as sizeable portfolio deals, have kept the investment market buoyant in Belgium, JLL said.
Vacancy rates in Brussels decreased from 9.9% to 9.6% in the first half, due to the lower number of completions taking place in 2007. Some 77% of take-up is strongly maintained by the corporate sector, where demand is still sound, up 7% in the second quarter compared with the first three months of 2007. Prime rents have risen 5% since the second quarter of 2006 and remain under upward pressure. It is anticipated that vacancy rates will decrease over the second half of 2007.
With interest rates seen rising in the Eurozone this September, JLL expects leveraged investors will become less competitive, leaving more room in the market for institutional investors and pension funds. Investment levels, however, have beaten the record levels witnessed in 2006 throughout the Belux region. In Brussels, yields will harden further in the light of continued strong international investment demand. Demand in Luxembourg has beaten forecast levels and shows no signs of slowing down.
Norbert Müller, Head of Capital Markets at Jones Lang LaSalle said 'Both the Belgian and Luxembourg markets remain very liquid. The growth perspectives in Luxembourg remain strong for the market and Brussels remains a safe-haven for wealth protection, especially in the light of challenging years to come in other European real estate markets'.