Retail Property in Belgium

Retail Property in Belgium
Large portfolio sales boost investment volume
Quarterly Market Update - Pulse Q3 2015
Photography Marc O’Polo
244,600 sq.m. taken up at end Q3 2015,
19% above Q3 2014.
160,000 sq.m. completions in 2015, and
300,900 sq.m. completions in 2016.
€
€ 2,000/sq.m./year prime rent for
high streets.
Prime rent remained stable this quarter.
€ 1.67 bn invested so far in 2015.
€ 1.2 bn invested in Q3 2015 alone.
2
| pulse | BELGIAN RETAIL MARKET |
Q3 2015
www.jll.be
Key Market Indicators
Market indicators
• Oxford Economics forecasts consumer spending in 2015 to reach the highest growth in five
years, 2.1%. Growth forecasts for the coming years are somewhat more modest.
• Annual GDP growth of approx. 1.3% is foreseen for 2015. Growth is expected to increase
to 1.8% in 2018 and will be supported by domestic demand and improving export growth.
• Consumer confidence declined in the third quarter to -10, the lowest of the year, but the
indicator improved to -8 in October thanks to a less pessimistic macro-economic outlook.
• The retail sales indicator shows a declining growth in the past 3 months. The index of
September 2015 stands at 102.43 vs. 104.17 end June. As a comparison, the same index
for Germany is higher at 105.7, whereas the index for the Eurozone (19 countries) stood
at 100.72.
Q3
2014
Q3
2015
Change
Consumer Confidence (NBB/BNB)
-11
-10
+1
Retail Sales Vol. Index* (Eurostat)
102.06
102.43
0.37
Q3 2014
Q3 2015
Change
71,438
84,825
19%
Take-up - YTD** cumulative (sqm)
211,241
244,606
16%
Completions - YTD** cumul. (sqm)
127,400
130,573
2%
1,850
2,000
8%
Q3 2014
Q3 2015
Change
268.8
1663.8
519%
Prime Yield % - high street
4.00
3.75
-25 bps
Prime Yield % - shopping centres
5.00
4.25
-75 bps
Prime Yield % - retail warehousing
6.00
5.75
-25 bps
Market conditions
Occupier market
Take-up - Q3 (sqm)
Prime Rent (€/sq.m./year)
Investment market > 2.5
MEUR
Investment volume cumul. (MEUR)
*DEFLATED AND DESEASONALISED - 2010 = 100
**YTD : YEAR-TO-DATE
Outlook
Outlook
Outlook
Sources : Eurostat, NBB, JLL Research 3
| pulse | BELGIAN RETAIL MARKET |
www.jll.be
Q3 2015
Take-up
Market overview
Just under 245,000 sq.m. of take-up were registered as at 9M 2015 in Belgium. In the third quarter
alone 85,000 sq.m. were taken up, 19% up on the same quarter last year. The largest take-up
volume of the quarter was recorded in retail warehousing, 41,500 sq.m., followed by high streets
with 33,300 sq.m. and shopping centres with 11,000 sq.m.
At the end of the third quarter 2015, 530 transactions had been registered, below the #560
recorded in the same period last year but 9% up on the 5-year average of 485. There were more
transactions than the last 5 years in retail warehousing, 141 against a 5-y average of 111, and in
high streets, 303 against a 5-y average of 264.
Shopping Centres
TAKE-UP UNDERPINNED BY DOCKS BRUXSEL
The 22,800 sq.m. taken up in shopping centres
represents 9% of the take-up of retail space so far
this year. and the highest transaction volumes so
far this year were pre-lettings in Docks Bruxsel,
for a total of 4,350 sq.m. Recent transactions
include Koezio (3,400 sq.m.), Maison Scotch (177
sq.m.) and Chala Coiffure (70 sq.m.). There were 5
lettings in Stadsfeestzaal on the Meir in Antwerp,
including Habitat (3,000 sq.m.). Hans Anders
and Hairdis let units in Wijnegem Shopping. 5
transactions were registered in Woluwe Shopping
Center, where Essentiel let 177 sq.m. and Mer du
Nord 125 sq.m. There was no transaction so far
this year in the Waasland Shopping. In Liège there
were 6 transactions in Shopping Belle Ile amongst
which the letting of 450 sq.m. by AS Adventure
and 90 sq.m. by River Woods. Two transactions
were recorded in Médiacité (401 sq.m.), and one
transaction in Galeries St-Lambert where JD Sports
replaces River Woods (461 sq.m.). Retailer rotation
in the main shopping centres in Belgium is limited
and has a downward impact on transaction volumes.
Retail Warehousing
INCREASING IMPORTANCE OF RETAIL PARKS
The volume taken up in retail warehousing, 141,000
sq.m., represents 58% of the retail take-up in
Belgium. The volume transacted so far this year is
10% higher than the 5-year average for the first nine
months.
Take-up is boosted by recently completed retail
park developments, often redevelopments of
older industrial property. Retail parks are a trend
that grows in importance versus individual retail
warehousing units. The recently opened Be-Mine
Retail Park attracted the highest volume this year,
15,500 sq.m. in 11 transactions, with retailers such
as Brico, Albert Heijn, H&M, Ava, etc. In Aarschot,
Action, Gamma, Albert Heijn, Maxizoo and Basic
Fit opened in the new retail park Witte Molen. The
largest transaction of the third quarter was the
letting of 3,380 sq.m. in Grivegnée (Liège) by Nissan
Belgium.
“The arrival of new premium brands and
the opening of state-of-the-art flagship
stores prove the attractiveness of our
AAA destinations.”
WALTER GOOSSENS,
HEAD OF RETAIL AGENCY
Developer : Equilis - Architect : Art & Build
4
| pulse | BELGIAN RETAIL MARKET |
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Q3 2015
Take-up
High Streets
BRUSSELS
With a take-up of 16,719 sq.m., high streets in Brussels performed 7% above their 5-year average in the
first three quarters of the year. In Brussels Uptown a large transaction was recorded with Apple. The brand
opened its first Belgian flagship store of 1,600 sq.m. in the Toison d’Or developed by Prowinko. Electric Valley
let the former unit shop of Mer du Nord on Avenue Louise 82 (1,180 sq.m.). In the luxury segment jewellery
brand Chopard replaces Lascar on Boulevard de Waterloo 57b (89 sq.m.) and Versace will replace Diesel on
Boulevard de Waterloo 7 (207 sq.m.). Also the arrival of newcomer Dolce & Gabbana on Boulevard de Waterloo
has been announced. On the other prime axis in Brussels Uptown, the Chaussée d’Ixelles, Sucx candy store let
55 sq.m. In Brussels Downtown there were no large transactions this quarter. Since the beginning of the year
there were 4 transactions on Rue des Fripiers. Transactions were also registered on Rue Neuve (Allo M&M 80
sq.m.), Rue du Marché aux Herbes (Pilly & Tony, 65 sq.m.) and Rue du Vieux Marché aux Grains (Tissu Market,
234 sq.m.).
ANTWERP
Since the beginning of 2015, 22,068 sq.m. were taken up in Antwerp. Letting transactions in the prime high
street zone include the letting of 474 sq.m. to Fred & Ginger and 400 sq.m. to Hallhuber (Gerry Weber Group)
on the Huidevettersstraat. So far this year, 7 letting transactions were registered on the Meir, amongst which
2 lettings to H&M, 1,900 sq.m. in No. 32-36 (replacing 2 other brands of the group, Comma and S. Oliver)
and 440 sq.m. in No. 95 for H&M Home. The letting of 300 sq.m. to JD Sports in No. 59 was also notable. The
Leysstraat which links the Meir to the Frankrijklei and the De Keyserlei saw the arrival of a flaghip store of
Guess (564 sq.m.), the letting of 1,230 sq.m. to Zara Home and of 2,700 sq.m. to H&M.
OTHER CITIES
In Ghent, 18 transactions were registered in the first nine months of 2015 with renowned retailers such as AS
Adventure, Kruidvat, Sac d’Anvers, Marc O’Polo, American Vintage and Sud Express. In Bruges 8 transactions
were recorded this year, the most recent being the letting of 725 sq.m. by AS Adventure on Noordzandstraat.
In Liège 15 transactions were registered so far this year, more than half of which on the the Rue du Pont d’Ile,
including retailers such as River Woods, 1001 Pattes and Olivier Dachkin. Recently Hilfiger Denim and Sud
Express signed on Rue du Pot d’Or. In Hasselt the most important transactions so far were the letting of 800
sq.m. by Pull & Bear (Inditex Group) and 600 sq.m by Mexx on the Hoogstraat, and the 550 sq.m. let by COS on
Kapelstraat. In Aalst 7 transactions were recorded since the beginning of this year, the largest being the preletting by Zara of 2,500 sq.m. on the Nieuwstraat 27.
TAKE-UP PER MARKET SEGMENT
High streets and retail warehousing outperform
TAKE-UP IN BIG SIX
Antwerp- Brussels - Ghent form top 3
sq.m.
400.000
350.000
300.000
Ghent
4.947 m²
10%
250.000
200.000
Liège
2.172 m²
4%
150.000
Hasselt
2.445 m²
5%
Bruges
2.779 m²
5%
Brussels
16.719 m²
33%
100.000
50.000
0
2010
Shopping Centres
2011
2012
High Street
2013
2014
Retail Warehousing
Q3 2015
Antwerp
22.068 m²
43%
5-yr Ave
Source all charts : JLL Research 5
| pulse | BELGIAN RETAIL MARKET |
www.jll.be
Q3 2015
Projects
Docks Bruxsel - Q4 2016
Côté Verre, Namur - >2018
Rive Gauche, Charleroi - Q1 2017
La Strada, La Louvière - Q4 2017
Uplace, Machelen - >2018
Kanaalkom, Hasselt - Q3 2018
LARGE PROJECT PIPELINE FOR 2016
The volume of completions will remain below average in
2015, but large completions will be delivered in 2016. In 2015
a total of 130,000 sq.m. was completed and approx. 30,000
more will be delivered before year-end, bringing the total to
160,000 sq.m., 6% below the 5-year average. For 2016, over
250,000 sq.m. are under construction and 50,000 more are
in the permit stage. The largest completions of 2015 so far
were Leonardo retail park in Evere (18,700 sq.m.) and beMine retail park in Beringen (15,000 sq.m.) On Avenue de
la Toison d’Or in Brussels the recently opened Toison d’Or
project of Prowinko (12,800 sq.m.) houses a flagship store
of Apple as well as Marks & Spencer, Zara and Bodum.
COMPLETIONS AND FUTURE SUPPLY
2016 will see a high level of completions
sq.m.
350.000
300.000
250.000
200.000
150.000
100.000
50.000
0
2010
2011
Completions
2012
2013
2014
Under construction
2015
2016
2017
Under permit
2018
2019
5-y Average
For 2016, two completely new shopping centres are under construction, Docks Bruxsel (49,000 sq.m.) and Rive Gauche
in Charleroi (35,000 sq.m.). Also in 2016 a 6,000 sq.m. extension to Les Grands Prés in Mons will be completed
together with a new retail park of 12,000 sq.m. linked to the shopping centre. In Hasselt a new Ikea (39,000 sq.m.) is
scheduled for opening early in 2016 together with an adjacent retail park of 6,000 sq.m.
Longer term, Uplace in Machelen (72,000 sq.m.) on the northeastern periphery is in the permit stage and planned
towards the end of the decade, and the Mall of Europe in the north of Brussels (80,000 sq.m.), part of the redevelopment
of the Heysel platform, is in the design phase.
Source all charts : JLL Research 6
| pulse | BELGIAN RETAIL MARKET |
www.jll.be
Q3 2015
Prime Rents & Investment
PRIME RENTS STABLE IN Q3
High Streets
Q3 2015
€/sq.m./year
Brussels
2,000
Antwerp
2,000
Ghent
1,550
Liège
1,200
Bruges
1,200
Hasselt
1,100
Shopping
Centres
Q3 2015
€/sq.m./year
Brussels
1,600
Antwerp
1,600
Retail
Warehousing
Q3 2015
€/sq.m./year
Brussels
185
Antwerp
175
BOOMING RETAIL INVESTMENT
Outlook
After three quarters 2015 is already an exceptional year for
retail investment, both in terms of volumes and yields. With
a total investment volume of € 1.2 bn in the third quarter
alone, the volume year-to-date is € 1.67 bn, already more
than 5 times up on the first 3 quarters of 2014. No less
than 4 exceptional transactions were registered recently,
involving shopping centres and portfolio deals. No less
than 4 transactions of over € 50 Mio were registered this
quarter. The recent acquisition by AEW Europe and China
Investment Corporation, a Chinese sovereign wealth fund,
of the Celsius Porfolio of CBRE Global Investors, is the
largest retail investment in Belgium of the last decade.
The portfolio includes 10 properties in France, and in
Belgium including the Waasland Shopping Centre in SintNiklaas and 50% of the Wijnegem Shopping Centre near
Antwerp. Of the € 1.3 Bn paid for the Celsius Portfolio,
approx. € 825 Mio is allotted to the two Belgian assets,
representing a yield of 4.1%. Another shopping centre,
Basilix in Brussels, was acquired by French institutional
investor Primonial for € 64 Mio.
Outlook
Recent large transactions also include high street and
out of town retail. The Constellation portfolio (high street
retail in Ghent and Mechelen) was sold to CBRE Global
Investors by developer MG Real Estate for € 79.6 Mio at a
yield of 5.4%. Developer Equilis sold a retail warehousing
portfolio to Belgian private investor Société de l’Argayon
for € 75 Mio at a yield of 6.5%.
Outlook
Yields remained stable this quarter after compressing in
the previous quarter due to the huge interest for all retail
asset classes and categories. Prime high street shop
yields are in the region of 3.75%, prime shopping centre
yields stand at 4.25% and prime retail warehousing yields
are 5.75%.
PRIME YIELDS
All retail yields compressed in Q2
“2015 will be an exceptional year
for retail investment, both in terms
of volume invested and yields.ˮ
JEAN-PHILIP VRONINKS,
HEAD OF CAPITAL MARKETS
%
7,0
6,5
6,0
5,5
5,0
4,5
4,0
3,5
5,75
4,25
3,75
Q4 2010 Q4 2011 Q4 2012 Q4 2013 Q4 2014 Q3 2015
Shopping Centre
High Street
Retail Warehousing
Source all charts : JLL Research 7
| pulse | BELGIAN RETAIL MARKET |
www.jll.be
Q3 2015
JLL Research Advisory Services
JLL time series for quarterly and submarket data are available on request, as well as tailormade
consulting. This is a fee-based service.
JLL Research produces on a quarterly basis detailed submarket reports about Brussels office districts
and the Belgian industrial and logistics property market. These are available on request against paying
subscription.
Our Research & Advisory service also prepares micro-location studies for landlords with a focus on rental
analysis, existing and future competition analysis with GIS mapping, transaction analysis and SWOT.
Contacts:
Pierre-Paul Verelst
Head of Research BeLux
+ 32 2 550 25 04
[email protected]
Ann Vanderwegen
Research Analyst
+ 32 2 550 26 81
[email protected]
8
| pulse | BELGIAN RETAIL MARKET |
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Q3 2015
Top 3 transactions 2015
OCCUPIER MARKET
High Streets
Year
Qtr
City
Address
Type
Sq.m.
Retailer
2015
3
Antwerp
Leysstraat 12
Letting
2,699
H&M
2015
3
Aalst
Nieuwstraat 27
Letting
2,500
Zara
2015
3
Antwerp
Meir 32-36
Letting
1,873
H&M
Shopping Centres
Year
Qtr
City
Shopping Centre
Type
Sq.m.
Retailer
2015
3
Brussels
Docks Bruxsel
Pre-letting
3,400
Koezio*
2015
2
Oostende
Stadsfeestzaal
Letting
3,000
Habitat
2015
2
Kapellen
Promenade
Letting
2,050
H&M
Retail Warehousing
Year Qtr
City
Address
Type
Sq.m.
Retailer
2015
1
Beringen
Be-Mine Retail Park
Letting
4,630
Brico
2015
1
Wilrijk
Boomsesteenweg 763
Letting
3,750
Impermo
2015
3
Grivegnée
Boulevard de Douai 32
Letting
3,380
Nissan Belgium
INVESTMENT MARKET
Price Yield
MEUR
%
Year
Qtr
Type**
City
Building
2015
3
SC
Antwerpen
Wijnegem 50% +
Waasland SC
825
2015
2
RW
Various
Portfolio Rockspring
2015
3
HS
Various
2015
3
RW
2015
3
SC
**RW : retail warehousing
HS : high street
SC : shopping centre
Seller
Buyer
4,1
CBRE GI
AEW Europe/CIC
129
6,5
Rockspring
Retail Estates
Constellation
portfolio
79.6
5,4
MG Real Estate
CBRE Global
Investors
Various
Portfolio Equilis
75
6,5
Equilis
Société de
l'Argayon
Brussels
Basilix
64
7
Certificate Basilix
Primonial
Transactions in bold were advised by JLL - *:JLL co-agent
OFFICE - BELGIUM
Avenue Marnixlaan, 23 b1
B – 1000 Bruxelles Brussel
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B – 2000 Antwerpen
T 32 (0) 3 232 39 30
F 32 (0) 3 233 76 85
www.jll.be
CONTACTS
WA LT E R G O O S S E N S
HEAD OF RETAIL LEASING BELGIUM
+32 (0)2 550 25 47
[email protected]
V I N C E N T H . Q U E R TO N
INTERNATIONAL DIRECTOR CEO BENELUX
+32 (0) 2 550 25 25
[email protected]
P I E R R E - PA U L V E R E L S T
HEAD OF RESEARCH BELUX
+32 (0) 2 550 25 04
[email protected]
JEAN-PHILIP VRONINKS *
HEAD OF CAPITAL MARKETS BELUX
+32 (0) 2 550 26 64
[email protected]
( *) Re vr on GCV
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