The Growth of the Antwerp Office Market 10
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THE ANTWERP OFFICE MARKET Trends and outlook 2019 TABLE OF CONTENTS INTRODUCTION 7 THE GROWTH OF THE ANTWERP OFFICE MARKET 10 CURRENT MARKET DYNAMICS 16 THE CO-WORKING SECTOR IN ANTWERP 20 DEALING WITH DECREASING VACANCY IN A DYNAMIC MARKET 23 ANTWERP OFFICE INVESTMENT MARKET 26 CONTACTS 28 “The city is located in the heart of one of the most concentrated urban areas in Belgium and Europe CUSHMAN & WAKEFIELD INTRODUCTION The city of Antwerp is the capital and has of the Antwerp province Antwerp functions as the main economic motor of the Flemish a population of roughly 520,000 region but is also an important international business epicentre inhabitants, making it the second for certain industries. Antwerp is the second largest portal city in largest city in Belgium. The city is Europe, the world capital in the diamond industry and Europe’s located in the heart of one of the largest petrochemical cluster. Moreover, the city has become an most concentrated urban areas in important fashion centre as well and is home to flagship stores and Belgium and Europe, forming a branches from all major domestic and international retailers. triangle with Brussels and Ghent where most of Belgium’s econom- The Antwerp office market benefits from a decent road network ic and industrial activities are lo- but accessibility during peak time is often problematic due to cated. heavy traffic congestion on the city ring road and the highways connecting the city. The railway infrastructure is well-established with direct connections to almost all major Belgian cities and some ANTWERP neighbouring capitals. Finally, Antwerp also benefits from an inter- national airport near the centre of the city. With more than two million square meters of office stock, Antwerp is the second largest office market in Belgium. It is important to note that the seven subdistricts forming the Antwerp office market stretch beyond the boundaries of the city of Antwerp. Most of the Antwerp district’s office stock is concentrated in the Centrum and the Singel. TRAVEL TIMES FROM ANTWERP BY CAR Brussels 40min Station Ghent 45min Antwerpen Centraal Amsterdam 1h30 Rotterdam 1h05 Frankfurt 3h30 Station Antwerpen Berchem Antwerp International Airport 7 CUSHMAN & WAKEFIELD ANTWERP OFFICE DISTRICT DASHBOARD ALL Q1 2019 ANTWERP FLANDERS MARKETS (Antwerp included) Total: 2,302,000 Centre: 1,144,000 Stock (sq m) 4,257,000 Singel: 511,000 Periphery: 647,000 2018 Take-up (sq m) 144,000 290,000 Five-year average (sq m) 127,000 212,000 Vacant spaces (sq m) 122,000 205,000 Vacancy rate (%) 5.3% 4.8% Prime rents 155 155 (EUR/sq m/year) Weighted average rents 115 115-135 (EUR/sq m/year) 8 CENTRUM SINGEL Kalmthout MAP OF ANTWERP OFFICE DISTRICTS Stabroek Kappellen PERIFERIE NOORD HAVEN Brasschaat Schoten Schilde Wijnegem Sint-Gillis-Waas Zwijndrecht Beveren Zandhoven LINKEROEVER Antwerpen PERIFERIE OOST CENTRUM Wommelgem Borsbeek Ranst SINGEL Kruibeke Mortsel Sint-Niklaas Boechout Edegem Hove Hemiksem Aartselaar Kontich Schelle Lier Temse Lint PERIFERIE ZUID Duel Niel Hamme Bornem Boom Puurs Rumst CUSHMAN & WAKEFIELD THE GROWTH OF THE ANTWERP OFFICE MARKET The Antwerp office market is composed ofthree main districts: ▶ ▶ ▶ CENTRE SINGEL PERIPHERY Enclosed by the Eilandje in the Borders either side of the Ring Is itself divided into the Haven, north, the railway and the Uit- to the south in the Berchem Linkeroever, Periferie Noord, breidingstraat in the east, the area. Periferie Oost and Periferie Schelde in the west and the Zuid subdistricts. Markgravelei and the Stati- estraat in the south. Antwerp is Flanders’ largest office market with a total stock of 2,302,000 sq m, ahead of Ghent (1,076,000 sq m), Leuven (555,000 sq m) and Mechelen (324,000 sq m). Antwerp’s office stock has grown at an average an- nual growth rate of 2% over the past 15 years. Over this period, its share in Flanders’ total stock has decreased from 59% to 54% while Ghent’s influence has grown over the period. ANTWERP OFFICE STOCK, SQ M (LHS) AND SHARE OF TOTAL FLANDERS STOCK (RHS) 2,500,000 60% 2,000,000 58% 1,500,000 56% 1,000,000 54% 500,000 52% 0 50% 11 12 17 10 13 14 15 16 18 05 07 06 08 09 20 20 20 20 20 20 20 20 20 20 20 20 20 20 Centre Singel Periphery Antwerp share of Flanders (RHS) 10 RUBENS ONE ROOF Antwerp is Flanders’ largest office market with a total “ stock of 2,302,000 sq m, ahead of Ghent, Leuven and Mechelen.” DISTRIBUTION OF THE OFFICE STOCK IN THE ANTWERP DISTRICT Grade A Grade B Grade C Unknown CUSHMAN & WAKEFIELD STOCK BY BUILDING GRADE A 7% B Only 25% of the Antwerp stock (or 575,000 sq m) 18% is not composed of Grade C buildings. This has been one of the main issues the Antwerp market 2,302,000 SQ M has had to contend with over the past years. In- deed, demand for quality modern spaces is consis- tently strong, while corresponding supply has not been as readily available. Nevertheless, a surge of speculative projects over past years signals a rec- C ognition on behalf of developers of an opportunity 75% to push the market forward. ANTWERP LARGE RECENT OFFICE DELIVERIES DELIVERY SURFACE TENANTS/ ASSET DISTRICT OWNER DATE (SQ M) OCCUPIERS Provincie Provinciehuis Centre 2019 6,000 Own occupation Antwerpen Locale Politie, Kuehne + Nagel, Crelan, KPMG, 2016 – Post X Singel > 50,000 IRET Coolblue, EY, Proximus, ongoing Christelijke Mutualiteiten, … VF Europe, Sweco, Meet The Link Singel 2018 27,000 Baloise District, Astrea, … Fidea Centre 2018 7,000 Fidea Own occupation Verzekeringen Antwerpse Havenhuis Centre 2016 10,000 Own occupation Havenbedrijf Engie Centre 2015 11,000 Baloise Engie, KBC 12 “...a surge of speculative projects over past years signals a recognition on behalf of developers of an opportunity to push the market forward.” In the longer term, several locations and large-scale urban projects across the Antwerp territory will play key roles in shaping the future of the market. These include (but are not limited to-): Blue Gate Antwerp Campus West Pelikaanstraat An important PPP which will re- Group Bouwen are in the process This RUP (Ruimtelijke Uitvoeringsplan – convert the 63 ha Petroleum Zuid of turning the Linkeroever dis- a form of spatial implementation plan) brownfield along the Schelde in trict into a creditable alternative is currently being drafted, having previ- the Periferie Zuid district into a office location. The developer ously existed as a BPA (Bijzondere Plan pole of activity centred on sus- has purchased the site of the for- van Aanleg – special land-use plan). In its tainable chemical research. mer Gazet van Antwerpen print- draft form, it outlines that the 15,000 sq ing works which is subject to an m area behind the Pelikaanstraat (Center important spatial implementa- district) could see the development of up tion plan (RUP) and authorises to 260,700 sq m of offices phased across the development of up to 80,000 five office towers among other functions sq m of offices. including residential and hospitality. Oosterweelverbinding Ex-Connectimmo site, Singel Infrastructual project which aims to add the final missing links re- Alides and Cores are planning quired to complete the Antwerp Ring road. Works on the Linkeroever/ to jointly develop a new office Zwijndrecht junction on the left bank of the Schelde (one of five key project on a strategically locat- junctions) are anticipated to start in 2019. The entire project is sched- ed plot of land previously owned uled to end by 2026. The Oosterweelverbindingproject is intended to by bpost and Connectimmo near improve traffic and mobility around Antwerp and could render previ- Berchem station. ously peripheral areas into interesting alternative economic locations such as is the case with the Linkeroever and the case of the RUP applying to Campus West. Several citizen groups are already formu- lating suggestions on how to leverage the project to develop and revitalise neighbourhoods. Blue Gate Antwerp Campus West Pelikaanstraat Oosterweelverbinding Ex-Connectimmo site, Singel CUSHMAN & WAKEFIELD CURRENT MARKET DYNAMICS Since 2014 included, average an- nual take-up in Antwerp amounts The Centre and Singel districts to 127,000 sq m. This number has have been the traditional hot- grown substantially over the past spots for market activity, espe- couple of years since dynamics cially in recent years - account- have moved up a notch thanks to ing for close to 70% of take-up. some large speculative projects These districts are the most which have entered the market sought-after by occupiers due and triggered large occupier to their accessibility and historic moves. The average number of and economic relevance. deals amounts to 186 per year over the same period and has also increased due to occupiers’ ANTWERP TAKE-UP, 000S SQ M (LHS) AND NUMBER OF DEALS (RHS) appetite for the aforementioned developments. 250,000 250 200,000 200 150,000 150 ... average 100,000 100 annual take- “ 50,000 50 up in Antwerp 0 0 11 12 13 15 17 18 14 16 10 05 06 07 08 09 20 20 20 20 20 20 20 20 20 amounts to 20 20 20 20 20 127,000 sq m.” Centre Singel Periphery # deals (RHS) A look at the distribution of take- up over the 2014-2018 period DISTRIBUTION OF TAKE-UP BY OCCUPIER TYPOLOGY, 2014-2018 underlines Antwerp’s main sectors of activity, although a 11% Belgian Administration couple of single large deals distort this view somewhat. Occupiers Finance Insurance 8% from the public sector, finance & Consumer goods insurance sectors, the industrial Education sector as well as logistics 45% 8% Industry companies provide the bedrock 647,500 SQ M of Antwerp’s office activity and 7% IT Telecom have been complemented by Real Estate the sectors such as ICT and the 6% Distribution-Logistic-Transport wider real estate sector over this 5% 5% 5% period.