real estate certificates voir pg48

Belgium Real Estate

Showcase 2010

Follow the guideMARKET TRENDS Supply and rental prices PROJECTS Offices, retail, logistics KEY PLAYERS Real estate developers, architects, advisers BEST STRATEGIES For investment and property management

Connect to www.pro-realestate.be for news, trends, network and management best practices related to the Belgian real estate market.

www.Pro-RealEstate.be

SUMMARY07 OFFICES08 | Olivier Bastin appointed to new post of Brussels Master Architect 10 | Brussels office market, 3 years to absorb rising vacancy 14 | Brussels offices development, forthcoming projects 21 | Antwerp market developing and strengthening position 24 | Regional real estate markets: dont forget the provincesEolis - rendering Assar Architects

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31 | The Office Affordability Index shows Brussels in strong position

33 RETAIL34 | Retail town planning in Belgium: rules for permits change 36 | High streets: the rental hit parade 37 | Shopping centres: forthcoming projects

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Shopping and leisure centre Just Under the Sky rendering Art& Build/ Quick it

39 LOGISTICS40 | European Distribution Report : Belgium holds its position 42 | The Belgian logistics market : multimodal benefits 44 | Regional governments put the accent on logistics

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Logistics site KBC Real Estate- Milmort ALTIPLANarchitects

47 INVESTMENT48 | Financing: Belgian Real Estate Certificates, rediscovering an ancestor 52 | VAT on the price of land: a reality from 2011 54 | Green buildings: a new reality, not a passing trend 57 | Mobility and the environment are the future concerns in office building

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58 | Financing : what are the banks looking for now ?

Belgium Real Estate Showcase | 2010 A special issue of Profacility quarterly magazine published by

EDITORIAL Editor in chief : Tim HARRUP [email protected] Editorial manager: Patrick BARTHOLOME [email protected]

Patrizia TORTOLANI, Senior Consultant, De Crombrugghe & Partners Pascal VANHUMBEECK, Consultant De Crombrugghe & Partners Jan VOET, Editor of Warehouse & Logistics Magazine Claude YVENS, Editor in chief of Warehouse & Logistics magazine. ADVERTISING & MARKETING Key Account Manager : Sigrid NAUWELAERTS [email protected] Marketing : Didier VAN DEN EYNDE [email protected] Advertising rates available on www.pro-realestate.be/advertising

PRODUCTION MMM Business Media Layout: Stphane Andry www.mmm.be Printing: Van der Poorten www.vanderpoorten.be Connect with www.pro-realestate.be for key information to optimize your real estate management: investment strategy (purchase, lease or rent), choice of the perfect location according to the company's activities, selection of the most suitable building, financing and taxation, building fit out, move, building facilities operations. All texts are protected by copyright. All ads fall under the sole responsibility of their authors. No part of this publication may be reproduced and/or published in any form or by means of printing or photocopying, microfilm, magnetic carriers, without the prior permission of the publisher.

Business Interactive Media sprl Avenue Louise, 475 1050 Brussels Phone: +32 (0)2 669 77 65 Fax: + 32 (0)4 387 90 87 [email protected] - www.bimedia.be Publication Director Didier VAN DEN EYNDE [email protected]

Contributors Georges BINDER, Director, Buildings & Data Gerrit CALLAERTS, Real Estate Finance Director, KBC Real Estate Guibert DE CROMBRUGGHE, Managing Director, De Crombrugghe & Partners Bruno DUQUESNE, Partner CMS Debacker Didier GREGOIRE, partner at CMS DeBacker and Head of Tax practice Thomas HAUZEUR, Associate at CMS DeBacker Andr LOMBART, Partner at CMS DeBacker Tams POLSTER, Head of Consulting Europe & Middle East, DTZ

Belgium Real Estate Showcase 2010

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DEBATEThe next stepsCrisis, what crisis ? Well if anybody needs to ask that, they havent been living in the real world and certainly not in the real estate world for the past couple of years. Rents are down vacancy is up, tenants are scarce, the banks are, to put it mildly, cautious The Belgian market, with Brussels as its nerve centre, has always had a reputation for stability, but like every other market, it has suffered too. The question now is, what is the way forward? To try and find some reasoning and some solutions, we turn to the experts on the ground, those who live through this new reality every day. They were able to debate the question at a recent seminar in Brussels. And in particular, we take a look at what they think about a possible moratorium on office building in the capital of Europe as a solution to current over-supply. Firstly, Nicolas Orts, Joint Managing Director of CBRE Brussels, and the person who to the surprise of many in his role as a broker first put forward the idea: We must have a transparent debate about this. Our view is that the crisis, leading to companies seeking space rationalisation, has caused a level of vacancy and subsequent pressure on prices which is not good for investment in the capital of Europe. So we recommend a moratorium in certain zones. Mathieu Sonck, Secretary General of the Brussels Inter-Environmental Agency, goes even further: A moratorium is not enough. We need to actually decrease the amount of office space. Company downsizing could double vacancy in the next five years. And as there is a lack of housing in Brussels, we would propose that developers are allowed to build a certain amount of offices if, in compensation, they also build a certain amount of residential accommodation. Serge Fautr, CEO of sicafi (real estate fund) Cofinimmo, approaches the problem from a different angle, well aware of the presence of Brussels Capital Region Minister-President Charles Picqu on the other side of the table: Lets concentrate on renovation, not new-build. And we work very hard trying to find tenants. It is up to the politicians to work just as hard to increase employment in the region this is what is needed, this is the solution. Firmly against the idea is Vincent Querton, MD of Jones Lang LaSalle Belgium: Our company is radically against a moratorium, for several reasons. We believe it would distort competition amongst the Regions, be unfair to all the various players in the real estate market, and in any case, how could it be legally framed? On the same side of the argument, for a different reason, is Eric Verbeeck, President of owners association UPSI: Construction is one of the economic drivers of our country, and putting a halt to it would be a bad thing. What does the Minister-President himself make of all this? We need to look at what the nature of the vacancy is in the various zones, which buildings are empty. And then we have to analyse what sort of buildings will be required in the future. Will they be technological, ecological, have a high capacity for future re-conversion? The decision on which buildings to build will be based on which buildings will have the best chance of commercial success. So no decision on a moratorium can be taken quickly. Other speakers evoked an auto-moratorium in other words market forces making the decision for us. And while no conclusion was reached, this would seem to be the most likely outcomeEric Verbeeck (left) and Nicolas Orts are on opposite sides of the moratorium argumentPhotos: Marie-Nolle Cruysmans/Editions & Sminaires

Serge Fautr: The politicians need to work as hard as we do

Mathieu Sonck thinks a moratorium is not enough

The Minister-President of the Brussels Capital Region, Charles Picqu: Analyse future needs

Vincent Querton: A moratorium would be unfair

Tim HARRUP , Editor IBelgium Real Estate Showcase 2010

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OFFICES

Iphoto G. De Kinder

n this section we take a close look at the principal office market of Brussels, its prices, its districts and its forthcoming projects. Alongside this, we talk to the newly appointed Brussels Master Architect about his role and his vision, and we

look at how overall office cost occupation is evolving and where Brussels stands. But Belgium isnt only about Brussels, and we put the spotlight on the other major regional markets. And, in this changing real estate world, we look at just what type of offices companies and associations are now looking for. The previously undisputed king of real estate sectors has been under severe pressure, so how is it coping ?

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SUMMARY08 I Olivier Bastin appointed to new post of Brussels Master Architect 10 I Brussels market: vacancy rising: current supply will take 3 years to absorb 14 I Brussels offices development, forthcoming projects 21 I Antwerp market developing and strengthening position 24 I Regional real estate markets : dont forget the provinces 31 I The Office Affordability Index shows Brussels in strong position .

rendering Jaspers-Eyers & Partners

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C O M PA N Y P R O F I L E S26 I ALTIPLAN | Architectural bureau 27 I VK ENGINEERING | Technical engineering 28 I GLOBAL | Building fitting out & workplace design 30 I ANIXTON | Real estate services & consultancy .

photo Atenor Group

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OFFICES I CITYSCAPE

Brussels Master Architect: thBrussels Region has recently appointed its own Master Architect, a role which is designed to oversee and bring a degree of harmony to the architectural procedures for projects instigated by the Region. The position is held by Olivier Bastin, who explains how he sees his work and the future of the city.What are your priorities? Firstly, to draw up an orientation note for the end of May, destined for members of the Brussels Parliament, but which will also be distributed more widely within the public and private domains with an interest in town planning. This will serve to identify the work of the Master Architect. At the beginning, for example, the domain is limited to projects initiated by the Brussels Capital Region, but this therefore only involves 5-10% of all projects built in Brussels which is very little. The original mission has been defined in this way because Brussels already has several layers of administration in town planning terms Regional, Communal administrations, for example, which means that communal projects theoretically do not have to pass through my office. So I would like to widen our sphere of activity to this domain. In fact, the dossiers we are already handling are more varied than the strict original definition: a communal project in Forest commune, a competition for the public spaces to be established around Schuman in the European district, the construction of a factory close to the Ring at Forest/Drogenbos, the competition for the Heysel plateau development. There are already Master Architects in Flanders, but not in Wallonia how do you see this evolving? I both appreciate and work with my Flemish and Antwerp colleagues. In Wallonia, they have been working on producing quality architecture for more than 15 years, and this is a good system, particularly in the context of PPPs. All I would say is that what they do works well, and we, the Master Architects in the other Regions, are striving to help them strengthen their position. I cannot say whether this will end up by a suitable person being appointed to a role like ours within Wallonia. Is your role part of a wider strategy, mobility for example? There have to be wider and longer term strategies for the city. Though it is not our role to intervene on questions of infrastructure. The Region and City have to make their choices, and it is up to us to make these as attractive as possible. So if the City decides it needs a new railway line, or RER, it is not our job to say but that will not look very nice just there. It is our job to make sure the finished article is as pleasant, as integrated as it can possibly be into its surroundings. One of our current dossiers, as I mentioned, is a factory. I said to the minister concerned that we will have a factory that people will come from all around Europe to see! The same goes for urban necessities such as car parks they dont have to be eyesores. And if a piece of ground has to be cleaned up, de-polluted, it makes sense to involve the landscape architect from the beginning, not at the end. Because of all this, I believe the public authorities are looking on us very favourably. How do you see a major international city such as Brussels developing, from an architectural point of view? Previously, it was believed that mixed use was the way forward. But this led to planners trying to artificially force a mixed character onto every district within a city. The new thinking is for the alveolar, or cellular, city. The idea here is to provide mixed use through keeping the identities of different districts, and allowing them to work together so that there is a genuine mix, both social and functional, throughout the city. Trying to create identical mixed districts everywhere cannot work. Mixture for mixtures sake is unproductive. It is better to identify the driving forces in each district, and make the most of these. Make districts interconnect,

The advantages of BelgiumBeing Belgian means taking advantage of the great diversity to be found in our country. In fact diversity is a major part of our life. You only have to look at the language situation two main languages are spoken in the major regions of Wallonia and Flanders (French and Flemish), and in Brussels you will hear both of these used freely within almost any business meeting, along with English. Not to mention all the other languages heard around the city. Belgium is like the cellular city accept the differences, make the most of them and live harmoniously with them.

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he future of the city is cellularharmonise the relationships between functions, keep the qualities of each district. I believe that the urban structure of Brussels works well, and can be a model for others. We have the advantage of not having built the peripheral ghettos to be found on the edges of some cities in neighbouring countries. An integrated city, not a collection of integrated districts, this is the aim. You have explained that your role involves public sector architecture, but that you see it potentially expanding. Does this include to the private sector? Where the private sector is concerned, it seems to that it is logical that we intervene to a degree. In a major project such as Tour & Taxis to the west of Brussels city centre (an entire city district project ed), for example, we would take part in the competition procedure for laying out the public spaces, and why not go even further, by inviting the private sector to take part in a competition for some of the buildings planned. I think the private sector would be enthusiastic about this, especially thanks to the media interest which would be generated. The competition logic exists already in the private sector. You will obviously have a major role to play in any competition process. What makes a good competition in your experience? Three things: firstly, a good programme, with clarity, and the objectives clearly and transparently explained to the architects. This means that the public authorities would often need to turn to a study bureau to produce a well defined programming study. There is acceptance of the notion of dialogue in Brussels, but this tends to make an appearance too late in the process, when 3-5% of costs have already been invested by the architects, which means the investing party is far less interested in true dialogue, being already out of pocket. Dialogue needs to start at the very outset. Secondly, good procedures. Too often, in public adjudications, it is the financial offer which counts and little else. We have to bring the notion of quality firmly into play. And at the moment there are also too many types of procedures, we need harmonisation. So we will look at what goes on at the moment, identify who does what, and then set ourselves the objective of constructing a more practical tool. Lastly, a good competition process needs a good jury process. By this, I mean that we need to get away from the perception that the jury is some sort of judicial organism, like in a law court, making a decision on whats good and whats bad. The jury is a meeting of minds, a sharing of experience, a process to make sure we end up with the best solution. You are inevitably going to be involved in the green movement in architecture. What are your thoughts on this? My thoughts are very pragmatic and direct! Only a fool would not go down the sustainable development route now, quite simply because not producing green buildings may render the final product unsaleable. And it should be remembered that by 2015 all public buildings in the Brussels Region have to be passive. The private sector is obviously going to go the same way. Tim HARRUP I

Olivier Bastin has taken enthusiastically to his role as Brussels first Master Architect(Photo: Audrey Contesse).


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OFFICES I MARKET TRENDS I

Brussels : 3 years to absorbIn Belgium, the real estate market principally involves the Brussels office market (some 61% of the market), even if, over recent years, other market segments have been gaining ground. Foreign companies appreciate the central location of Belgium between the major markets of Germany, the UK and France which, combined with the substantial developments in rapid transport links (TGV and airport), enable easy connections with these different markets.

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The recent leasing of the whole of the Marquis by Fortis Holding, along with the purchase for own occupation of the Forum project (41,000 m) by the Belgian State, and of t Serclaes (17,500 m) by HUB (Hoge School Universiteit Brussels) constitute 3 major transactions which have diminished market supply.

n 2009, take-up amounted to around 430,000 m for the whole of the Brussels Capital Region, or some 20% less than in 2008. This decrease in take-up reflects a trend seen throughout Europe, with a drop in demand resulting from the slow down in the global economy. The decrease was also partially due to a reduction in take-up from the public sector. The last quarter was notable for certain large scale transactions which managed to boost recorded take-up levels despite all this. Since 2007 the market has been experiencing a general fall in rental levels, exacerbated by the recession of 2008 and 2009. Pressure on rents is a consequence of slack demand combined with increasing supply. The general sentiment of tenants is to wait, and many companies are taking advantage of the next break in their leases to renegotiate the financial conditions contained in it. Within a context of weak demand, owners have difficulty in finding tenants and are offering more interesting rental levels or other incentives to attract new takers. The future evolution of rental levels will depend on the balance between supply and demand. Taking the current high level of supply into consideration, some 2,016,000 m (of which 1,466,000 m of vacancy plus 550,000 m of projects underway, including the State Administrative Centre, and expected to be delivered in 2010 and 2011), and average take-up of 575,000 m per year recorded over the past decade, it will require

around three and a half years before current supply is absorbed. This situation perfectly reflects the current market over-supply, implying downward pressure on rents over the short and medium term. Current situation, developments and trends for each business district I Centre (Pentagon) This takes in the whole of the zone contained within the inner ring road. It constitutes the financial centre of the city and the country, through the presence of the Brussels stock exchange and the National Bank, which has taken in many other banks over time. This zone is bounded by first rate shopping streets. Going beyond the presence of Central Station around which have developed numerous large scale projects over recent years, this zone has the advantage of excellent public transport networks, which represents an overriding criterion in selecting a location, particularly for the large institutions and public administrations. The principal occupants to be found here are Belgian financial groups, ministries and private companies. As well as the good image of the district, it also possesses an excellent mix of functions and services. Before the crisis, this district represented a relatively stable market, with vacancy of under 5% and an increase in rental levels year on year. New projects to come to the market (such as the Marquis, 33,500 m) have increased supply and as a consequence vacancy levels (to over 6%), while creating

Le Marquis. (Altiplan Architects Photo G. Kinder).

Forum. Rendering Archi 2000

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rising vacancydownward pressure on rents. The recent leasing of the whole of the Marquis by Fortis Holding, along with the purchase for own occupation of the Forum project (41,000 m) by the Belgian State, and of t Serclaes (17,500 m) by HUB constitute 3 major transactions which have diminished market supply. The renovation of the State Administrative Centre, representing a potential of 70,000 m of offices, nevertheless risks adding to vacancy when it comes to market in a few years. In this zone rents currently stand at an average of Eur 185/m/year, with prime rents at Eur 210/m/year. I South (Midi) District This district is located around the South Station, and has greatly developed over the past ten years. These numerous developments, along with the arrival of the TGV and the complete refitting of the South Station, have turned it into an office zone in its own right. Its principal occupants are public administrations and service companies such as the Social Security Company ONSS. The South District is above all a lessors market. Supply is limited and demand more substantial. This is reflected by a very low vacancy rate (below 1%). Potential tenants for this district therefore have little negotiating room. I North District This district has become more and more frequented over the past 15 years, in particular due to the lack of sites available in Brussels. This is a modern district, located just outside the Pentagon, around the Boulevard Albert II, between the Avenue du Port and the North Station. This station provides of a good network of public transport facilities. Companies located in the North District are from various sectors, and generally have need of substantial amounts of office space. The public sector represents an important proportion. The installation of the European Commission in Covent Garden is also a first step towards the creation of a new European hub. Demand for this location is currently driven by the ambitions of the French-speaking community, with its headquarters on the other side of the canal, and by private operations of smaller scale. The marketing of new projects such as Boral (35,000 m) Zenith (30,000 m at an asking price of Eur 205/m/year), will be crucial over the coming months. As long as these new projects stay empty, rental levels will remain under pressure until the market absorbs the current supply, even though it is in this district that the landmark letting of the year was recorded, with the leasing by GDF-Suez of a project developed by Fortis Real Estate, North Light and Pole Star, 2 towers with a total surface area of 75,000 m. Vacancy levels and pressure on rents will also depend on the redevelopment of the Tour & Taxis site, which will eventually provide some 140,000 m of offices. I Leopold (European) District With almost 25% of total Brussels office stock (almost 3,485,000 m), the Leopold District represents without any doubt the most important business district of the capital, with the Schuman roundabout and the Square de Mees as its nerve centres. This district is located to the east of the city centre and is spread around the Rue de le Loi and Rue Belliard, between the Boulevard du Rgent and the Cinquantenaire Park. It has the advantage of an excellent network of public transport, with in particular the Luxembourg and Schuman railway stations, enabling immediate connections with the entire national and international network. Many metro stations and bus lines also serve the district, with their axis on the Rue de la Loi. It is essentially the European institutions which occupy this district, along with the major national ministries, and certain Belgian and foreign company headquarters. The presence of the European Parliament and Council of Ministers only serves to strengthen the attraction of the District. The installation of the European Commission in Madou Tower suggests that the European District is beginning to extend towards the North District. As with the Central district, the Leopold District, which could be considered as a stable market up to now, has seen its vacancy levels rise to above 9% in 2009, in particular due to the arrival of new projects such as The Capital (54,300 m), with a consequential

tSerclaes. Rendering Jaspers-Eyers & PartnersBelgium Real Estate Showcase 2010 11


The business districts of the Brussels Region.

downward pressure on rents. Negotiations underway between Axa Belgium and the European Commission for the letting of at least 50% of the building enable the prospect of an improvement for the district to be glimpsed. I Louise District This district is located to the south of the inner ring road, essentially along the Avenue Louise, between the Porte Louise and the Cambre woods. Access to this zone is less easy and the office buildings contained within it tend to be of older construction. Over the past few years the city has been orienting its policy towards converting office buildings into residential. This is a mixed environment which includes residential, offices, some high quality shops, hotels and restaurants. It is largely small and medium private companies which are to be found here, along with law firms and consultants, attracted amongst others by the proximity of the law courts. The advantage of this zone is that there are still small, efficient surface areas to be found. The Louise District records one of the highest vacancy levels of the central districts, with a rate of around 11.4%, even though new projects are relatively scarce. Amongst these should be mentioned, however, the Platinum, a 26,400 m building currently undergoing total renovation. The Belgian Buildings Agency (Federal Scientific Policy) has just taken up 12,700 m in this building. Along the Chausse de Charleroi, there is another large scale project underway. This is the Trio, by CBRE Investors, the redevelop-

Centre North Lopold Louise Decentralised Periphery South

Market dashboard 2009: 13,455,000 m of officesDistricts Key figures Stock (m) % of total % second hand buildings % Vacancy Prime rents Prime yields (%) Centre 2 400 000 17,8% 45,0% 6,3% 210 6,25% South 475 000 3,5% 23,5% 1,0% 195 6,80% Lopold 3 485 000 25,9% 27,3% 9,1% 265 6,00% North 1 450 000 10,8% 21,5% 6,5% 195 6,50% Louise 770 000 5,7% 52,5% 11,4% 200 7,00% Decentralised 2 875 000 21,4% 38,0% 15,5% 185 8,00% Periphery 2 000 000 14,9% 5,0% 20,9% 165 8,50%

Strong and weak points of the various districts of the Brussels Capital Region Advantageous fiscal regime Access by public transport Quality of stock Presence of facilities Presence of green areas ++ = ++ ++ + ++ -+ + ++ -++ ++ ++ = ++ = = + + ++ -+ + ++

++ Excellent I + Good I = Average I - Poor I -- Bad These figures are taken from a research carried out by De Crombrugghe & Partners. For further information an detailed report of this survey, please contact them : [email protected] - Tel. +32 (0)2 663 43 83

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ment of a 21,800 m ensemble spread through tree independent, interconnected buildings. I Decentralised (within the Brussels Capital Region) This zone includes the other districts located within the 19 communes of Brussels. It is less homogenous and office buildings zones are concentrated along the major thoroughfares, such as the Chausse de La Hulpe, Boulevard du Souverain, Boulevard de la Plaine, Boulevard du Triomphe and Boulevard de la Woluwe. Notable international companies such as BASF, Levi Strauss etc. choose to locate here. It can be observed that the districts which are well served by public transport, such as the Chausse de La Hulpe and the Boulevard du Souverain, perform far better than those zones with a less developed public transport network, such as the Rue Colonel Bourg and Marcel Thiry, where a very high vacancy level is recorded. Within this context, converting office buildings into residential is one alternative envisaged in these more difficult districts. With a vacancy level of 15.5%, the Decentralised districts have seen the smallest rise in this domain, due largely to the low level of deliveries of new projects in 2009. Average rents stand at 105 EUR/m/year, with prime rents reaching 185 EUR/m/year. The main transaction in this zone involves the rental of 4,500 m in Solaris, the first green building in Brussels, located on the Chausse de La Hulpe. The trend towards green buildings is set to grow over the coming years, to the detriment of buildings which consume more energy. I Ring and Periphery (outside of the Brussels Capital Region) This zone, which takes in those communes alongside the Ring (Machelen, Zaventem, Waterloo etc.), has grown considerably over recent years with the development of numerous office parks. This first took place around the airport at Zaventem (Keiberg, Airway Park, Airport Business Center, Ikaros, Airport Plaza, Astra Gardens, Pegasus, Corporate Village) which is a zone in its own right, and then extended towards more distant zones such as Waterloo, Braine lAlleud, La Hulpe, Hoeilaert, etc. (Waterloo Office Park, Collines de Wavre, etc.). Accessibility by car is good, although this has been less evident over recent years, due in particular to the substantial concentration of office parks in these zones. These are generally less well served by public transport, even if there is to be observed a genuine effort to improve the network, especially around Zaventem. Occupants here are largely computer and technological companies. The major attraction is to be found in the rental levels, more competitive than the city centre, coupled with a more advantageous fiscal policy.

Guibert DE CROMBRUGGHE, Managing Director Patrizia TORTOLANI, Senior Consultant Pascal VANHUMBEECK, Consultant De Crombrugghe & Partners I

Belgium Real Estate Showcase 2010 13

OFFICES I FORTHCOMING PROJECTS I

Brussels market: High qualityThe projected increase in vacancy over the coming year or more due to speculative products coming onto a market which is suffering from a crisisinduced lack of demand, has led to developers slowing the pace of new at-risk constructions. This situation is likely to last until at least 2010, but the buildings which are coming to the market in the interim period are of high quality and are already displaying the green technical features which will become compulsory as timeJaspers-Eyers & Partners

North Light / Pole StarDeveloper: Architect: Surface area: Delivery: North District, Brussels Fortis Real Estate Jaspers-Eyers & Partners 75,000 m September 2010

North Light / Pole Star is the latest to take its place in the North District of Brussels, the so-called mini-Manhattan located close to the canal and the city centre. The letting of this project at the very end of 2009, almost a year before completion, to GDF-Suez, saved the Brussels letting market from what would have been a disastrous year.

goes on.

Rendering Archi 2000

A2RC Architects

Tour & Taxis South City OfficesAvenue Fonsny 23-30, B-1060 Brussels South City Office SA & South City Hotel SA (Atenor Group, Espace Midi (Besix Red, CFE, CIB, Soficom Development) and BPI) Architect: A2RC Architects / Jaspers-Eyers & Partners Surface area: 18,670 m2, offices Parking : 96 Delivery: November 2010 Developer:This project is located along the Avenue Fonsny, and forms part of an extensive restructuring programme for the South Station area, which has been underway for around two decades. The building is opposite the exit from the South Station concourse. The faade is conceived in light coloured stone with parts in brick and other elements in grey-tinted thermo-lacquered aluminium. The glazing features a high degree of light transmission, acoustic and thermal insulation. The office buildings have been designed for maximum comfort for the occupants.

Developer: Architect : Surface area : Delivery:

Boulevard Du Port, 1000 Brussels Project T&T Several, by project +/ 400,000 m all functions included ongoing over several years

To refer to Tour & Taxis as a project is an understatement. Located along the canal, it is very close to the North District, and is the largest single urban redevelopment programme ever seen in the capital (on a 30 h. site). It includes restored listed buildings (the former customs buildings from the 19th century), along with the creation of offices, residential accommodation, a very large green area and the Brussels Environment building, the largest passive building in Europe.

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y products in favourSouth CrystalDeveloper: Architect: Surface area: Parking: Delivery: Avenue Fonsny, 1060 Brussels South Crystal A2RC Architects 6,537 m offices ; 840 m retail 34 March 2011 Developer : Architects: Surface area: Delivery:

PremiumQuai de Willebroeck, Brussels Atenor / Alco Building Ateliers Lion (Paris) et A2RC (Brussels) 80 000 m total, 30,000 m offices From 2011Premium is a new tower development located in the North District of Brussels, across the canal from Tour & Taxis. As well as the 140 metre high tower there will be lower level villa-type constructions and a vast office complex. The whole of the project will benefit from services such as a concierge, wellness centre, and a promenade alongside the canal.

Alongside Brussels South Station (TGV, Thalys, Eurostar), South Crystal represents the first office building on the Avenue Fonsny when coming from the major boulevards. Much smaller than the other office buildings, it assumes the role as an urban relay, through its medium size, which underlines contrasts and connections: a transition between horizontal and vertical fabric taking its place alongside a neighbouring hotel of vertical structure on the corner of a street and an avenue a clear expression of a dual offices/shops programme

A2RC Architects

Atenor

rendering Jaspers-Eyers & Partners

Jacqmain 135Boulevard Jacqmain 135, 1000 Brussels Developer: Kairos Architect : Jaspers-Eyers & Partners Surface area : 11,000 m offices, + retail and residential Parking : 78 Delivery : May 2010Jacqmain 135 is located in the centre of Brussels, close to both the historic heart and the North District. It represents a combination of a restored building and a new construction, and will offer mixed functions of offices, residential accommodation and retail.

Connect with www.pro-realestate.be to discover office development projects and find the coordinates of their real estate developers, architects, and advisers



Jaspers-Eyers & Partners

Media CornerChausse de Louvain / Avenue Lon Grosjean, 1140 Brussels Developer: Robelco Group Architects: Assar Architects / A2RC Architects Surface area: 32,972 m (4 buildings) Parking: 740 Availability: tbdMedia Corner has been designed so that a remarkable weeping willow tree will remain visible from the Chausse de Louvain, through the particularly transparent architecture. The faades of the first three buildings are composed of brick, and are of filled and empty type. Anodised aluminium has been selected for the window frames. The dynamic aspect and the sense of rhythm of the faade are achieved through several combinations of formats, including openings of two different sizes, and modulation of 135 cm. Some of the openings will be grouped together via an anodised aluminium window feature.

Dtrois

A2RC Architects

Van Volxem Astro TowerDeveloper: Architects: Surface area: Avenue de lAstronomie 14, 1000 Brussels Astro Tower Lease Jaspers-Eyers & Partners 48,150 m Avenue Van Volxem 366-368, 1190 Brussels Developer: CIT Blaton, JCX Immo Architect: Art & Build Architect Offices: 20,349 m (6 buildings from 2,502 m2 to 4,284 m2) Parking: 183 Delivery: 2011 +

Originally constructed in 1976, Astro Tower is located close to the Place Madou on the Brussels inner ring road. This location is between the Leopold (European) district and the North district. The building offers 31 floors at a total height of 107 metres. The renovation will feature a dual faade cladding, and the installation of wind turbines, which will significantly decrease energy consumption.

Located a few hundred metres from Brussels South Station, the philosophy behind the project is based on sustainable development. The accent has been put on the recyclable nature of the project: the construction of autonomous units, the size, the floor areas, the free height, all enable a high degree of flexibility of use and easy conversion to other uses without problem. The inside finishing has been intentionally reduced in order to favour basic, strong and recyclable materials: brick faades, wood, aluminium, steel, stone; listed buildings on the site have also been renovated.

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Hooox

Platinum QuattuorChausse de Wavre 1076-1124, 1160 Brussels Developer: Brustar Auderloft sa Architect: Assar Architects Surface area: 10,828 m (4 buildings) Parking: 186 Delivery: beginning immediately, in phasesThe site comprises three parts, spread across 4 buildings surrounding a small square. In the interests of coherence, the architects decided upon similar sizes (3 or 4 levels above ground) and decided to use the same ranges of materials and colours: lower parts in natural stone or similar, with the treatment of the upper levels being in brick and light coloured roughcast, metallic coverings, dark window sills In order to alleviate the volumes, the upper floors are slightly set back compared to the ground floor. There is a retail element to this development.

Developer : Architect : Surface area : Delivery:

Avenue Louise 245, 1050 Brussels Burco Archi 2000 23,620 m Spring 2010

Platinum is the first major development on the Avenue Louise (Louise office district) for many years. It occupies a position midway between the Bois de la Cambre woods and the Place Louise (law courts). The Platinum has been designed to offer modern facilities and energy efficiency, and is partially pre-let to the Belgian State and a law firm.

Image supplied by Immobel

Image supplied by Burco

Yvan Glavie / Crepain Binst

Impratrice 17-19Boulevard de lImpratrice 17-19, 1000 Brussels Developer : Befimmo Architect : Crepain Binst Architecture Surface : 14,158 m Parking: 53 Delivery: 2011Impratrice represents the total renovation of an iconic building first constructed in 1960 and bearing the name Telex. It has been recognised by the Brussels Capital Region, receiving an award for ecological conception, low energy use and costs, and reduced CO2 emissions. Impratrice 17-19 is located between Brussels Central station and the St. Michel and Gudule Cathedral, just a stones throw from the GrandPlace. The area around the station is currently being entirely renovated.

ForumRue de la Croix de Fer Rue de Louvain , 1000 Brussels Developer : Immobel Architect : Archi 2000 Surface area : 55,000 m Delivery: 2010-2013Forum occupies a block in the heart of Brussels historic centre, just behind the Belgian Parliament and Senate, close to the Royal Park and Palace, and a short distance from the GrandPlace. In early 2010 the sale of the building to the Belgian State, for its own use, was confirmed; the building is set to be delivered in phases over a 3-4 year period. It has been designed to be energy-efficient, with features such as rain-water recuperation and low luminance lighting.

Connect with www.pro-realestate.be to discover office development projects and find the coordinates of their real estate developers, architects, and advisersBelgium Real Estate Showcase 2010 17


White AtriumAvenue de la Toison dOr, 1060 Brussels. Property manager: BEOS Gmbh Architect : Atliplan Architects Surface area : 9500 m Delivery: 2010

White Atrium is undergoing a total renovation, and will be equipped with the latest technological features. Most of the building is occupied by offices, but it also includes some residential accommodation and a wellness centre. Located close to the Law Courts and the Avenue Louise, White Atrium will offer extremely flexible offices set around a vast atrium.

VeridisAvenue Herrmann-Debroux, 1160 Brussels Developer: Herpain Urbis Architects: Assar Architects Arcade Surface area: 6,561 m offices Parking: 69 Delivery: tbaLocated in the green districtof Auderghem in Brussels, the Veridis office building is part of the voluntary approach of developing a new building generation with environmental, social and economic added value. The aim is to decrease the ecological footprint of the building while improving the health and the comfort aspects. Veridis, which is currently in conception phase. Spread over four floors, Veridis provides 6,561 m of above-ground office space and 110m of below-ground archives, along with 69 parking spaces. The average floor area is 1,500m. The project brings together architectural quality and comfort with technical and environmental performance.


Image supplied by Assar Architects

Altiplan Architects

Image supplied by Anixton

Realex GatewayDeveloper: Architect : Surface area : Brussels Airport Brussels The Airport Company Jaspers-Eyers & Partners / A2RC 48,000 m Rue de la loi 99-105, en Rue J De Lalaing 30-34 1000 Brussels Developer : Dexia Insurance/Realex Architect : Jaspers-Eyers & Partners Surface area : 28,425 m + 10,589 m Parking: 90 Delivery: 2012 - 2013Described as possibly the last major development in the Leopold (European) district of Brussels, this real estate development project consists of a plot located at Rue de la Loi 99105. It has been granted a planning permit which allows for substantial office space above ground and a large basement area. In addition to its high architectural quality, the building will be state of the art in terms of both technology and the environment.

Gateway is being entirely renovated, having originally been in a U shape alongside the original terminal at Brussels Airport. It will now be set around a central atrium. There will be a covered garden which will constitute a meeting area for the whole complex.

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BelairBoulevard Pacheco, 1000 Brussels Developer: Breevast Architect: Jaspers-Eyers & Partners / Arne Quinze studio / Archi 2000 Surface area: 70,000 m offices + hotel + retail + residential Parking: 2,400 Delivery: 2012This project represents the redevelopment of a very long building located alongside Brussels inner ring road, close to the North District and the historic city centre. Once completed it will offer not only 70,000 m of offices, but a large public area with a hotel, residential accommodation and a retail facilities.

AtlantisDeveloper : Architect : Surface area : Delivery: Avenue Charles Quint, 1040 Brussels Codic DSW Architects / Cerau 24,000 m Autumn 2010

The Access and Bridge buildings, currently under construction, have been awarded BREEAM certification with the mention Very Good. These are the first buildings in Europe to be certified under the new BREEAM Europe for Offices norm. Amongst factors taken into account are construction process management, comfort, health and safety of occupants, along with energy use considerations and accessibility by public transport. Atlantis is located at the western entrance to Brussels, at the end of the motorway leading to the seaports of Zeebruges, Ostend, Calais and Dunkirk.

Image supplied by Codic

Image supplied by Montois Partners Architects



TrioChausse de Charleroi 110-116, 1050 Brussels Developer : CBRE Investors Architect : Jaspers - Eyers & Partners Surface area : 24,951 m Parking: 137 Delivery: August 2010Trio offers three units ranging from around 3,000 m to over 11,000 m. It benefits from facilities styled by the developer as Five Star Services, including a concierge for taking care of the needs of its occupants in terms of the provision of outside services. Located in the Louise business district, Trio isclose to the Place Stphanie and Place Louise, and therefore benefits from good public transport connections in addition to its own 137 parking spaces.

Airport PlazaVuurberg Grenstraat, 1831 Diegem Developer : Robelco Investment manager : CBRE Investors Architects : Montois Partners / Laurent Willox / Maud Caubet Surface area : 36,159 m Parking: 697 Delivery: 2009-2010A major new multi-building project at the very entrance to Brussels International Airport it is literally within walking distance Airport Plaza is the latest addition to this thriving business district. One of the advantages in terms of access, apart from the obvious, is that Brussels Airport has a direct rail link to the city centre, running every 15 minutes and with a 15 minute journey time.

Connect with www.pro-realestate.be to discover office development projects and find the coordinates of their real estate developers, architects, and advisersBelgium Real Estate Showcase 2010 19


Europa EolisSquare Sainctelette, 1000 Brussels Developer: CBRE Investors Architect: Assar Architects Surface area: 8,991 m2 (office + archives) 304 m2 retail 210 m terraces Parking: 41 Delivery: August 2010The Eolis project represents the redevelopment project of an office building located at the Square Sainctelette close to the North district of Brussels. The layout will offer optimal flexibility to choose between partitioned and open-space offices. The building meets the Brussels EPB 2011 regulations (E=75; K=34) and also complies with the International environmental label (the HQE certification).

Developer : Architect : Surface area : Delivery:

Rue de la Loi, 1000 Brussels Atenor Archi + i 30,000 m 2016

Located on the Rue de la Loi in the heart of Brussels European district, Europa forms part of a project to redesign this area, breaking up the corridor effect of the road. The architectural style of the building has to take into account the desire of the Brussels region master-plan to integrate any new construction here into its surroundings.

Assar Architects

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Atenor


Antwerp market developing and strengthening positionIn Belgium, the Antwerp office market can be considered as the second largest after Brussels. It represents around 10% of total Belgian office stock, some 2,100,000 m including Mechelen. By contrast with the Brussels market, Antwerp is not really international in vocation. It revolves around regional activity, with the port as a major driver. Companies working in the secondary and tertiary sectors find it important to locate their regional or provincial headquarters here.ntwerp has not escaped the consequences of the crisis but has been less affected than Brussels. Take-up has remained at comparable levels with previous years, reaching almost 90,000 m in 2009. It was take-up in large surface areas which suffered the most, which had few repercussions for the Antwerp market which is less dependent on this type of demand. Although rents were under pressure, they decreased by less than in Brussels. Prime rent stands at around 145 EUR /m/year and average rents at around 85 EUR /m/year. Vacancy remains high, at above 11% or almost 230,000 m. This vacancy level combined with projects set to come to the market over the next 2 years, with an estimated total surface area of 37,000 m, means that it will require 2.3 years for market supply to be absorbed, taking into account the average take-up of 100,000 m per year registered over the past 4 years. Following 2009, a year which was active in terms of deliveries onto the market, with projects such as the 26,700 m City Link and the Avenue Building, 2010 should be quieter, with the delivery of Noordster (around 15,000 m), which is entirely pre-let, and the 4,500 m of Clipper House. An economic recovery together with the low level of scheduled new

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office projects may in time translate into a decrease of vacant space.

The market is geographically divided into 4 main zones: The Port (Old Port and New Port), Centre, Singel or Ring, and Periphery.I Port Port activity, which has never stopped growing in importance is without any doubt the driver behind the Citys economic activity. Many production companies, followed by distribution companies, which will gradually become offices as the tertiary sector grows within the economy, set up over time around the port.

The landmark letting of 2009, carried out by Cofinimmo, the take-up by Mercator Assurance of 13,808 m of offices in the City Link at Berchem, with a fixed 12 year lease and a rental level announced at 125 EUR/m/year.

image supplied by Kairos



This zone represents around 15% of total stock and can be divided into two sub-zones: Q Old Port The Old Port district extends parallel to the Schelde, to the north of Antwerps main square, up to and around the Bonaparte and Willem docks. A small core of prestigious maritime companies is still to be found in this zone, a result of the port activity which was carried out here before it moved northwards with the modernisation of the Port of Antwerp. This zone benefits from a good road network which enables easy access to East Flanders via the Waasland tunnel, and to the city centre. The district is characterised by a mixed building stock, bringing together the oldest of office buildings with more modern constructions. Q New Port The New Port has mostly grown up over the past 20 years. It essentially extends along the Noorderlaan. Most buildings in this zone are in need of total renovation. Companies located in this zone, whose activities are directly connected to port activity, also benefit from access to the Netherlands via the A12 (Antwerp-Roosendaal) and A1 (Antwerp-Breda) motorways located just a few hundred metres from Noorderlaan. I City Centre This area takes in the whole of the zone contained inside the inner ring road and extends tothe edge of the port zone in the north. Three principal zones can be identified: the zone which extends to the north of the Meir: little soughtafter due to a lack of modern buildings and of visibility. the Diamond district: this zone is essentially concentrated around the Central Station where all of the diamond business (cutters and traders) is to be found. Offices here

are mostly small in size and their popularity depends on the input of natural daylight from the north, essential in this domain where light plays an overriding role. the south of the city: the office zones to be found here are mostly concentrated around the three main axes: the Leien (Amerikalei, Britselei, Frankrijklei and Italielei), Mechelsesteenweg and Plantin & Moretuslei. This part is very popular with the large administrations as well as with companies from the banking sector, most notably because of its central location, offering excellent visibility along the citys main thoroughfares and because of the well-developed infrastructure (shops, hotels, restaurants etc.), and because of the substantial amount of public car parking facilities. Finally, the public transport network is good, with Central Station enabling communication with the whole of the national and international networks. Works on the new Antwerp Central TGV terminal are complete and have improved international access to the city.

Because of the large proportion of second hand buildings, almost half of vacancy is concentrated in this area, and projects are very rare. The two projects which have already been delivered and which are still awaiting their first occupants are the Plantin & Moretus Building (9,000 m) and Copernicus (14,000 m). I Singel (Ring) This zone extends along the citys ring road and either side of the Singel and Binnensingel. Most new office projects are to be found in this area. The lack of modern large size buildings (the average is around 3,500 m) in the centre have persuaded many companies to turn to the Ring or the Periphery, which have experienced the greatest amount of development over recent years. The Ring zone does indeed offer many significant advantages in terms of location choice: the presence of large size modern buildings responding to the requirements of current users excellent links via the Ring to the various national and international motorways (Ghent to the west, Breda and Roosendaal to the north, Lige to the east and Brussels to the south) the proximity of the city centre and its infrastructure avoidance of city centre traffic problems good visibility It is in this zone that the large institutions and private occupiers are to be found, and where the landmark transaction of 2009 took place, with the take-up by Mercator Assurance of 13,808 m inNoordster, located on Ellermanstraat in the centre of Antwerp, is one of the large real estate projects to be delivered in 2010 : 15,000 m2 already entirely pre-let to the Belgian Buildings Agency for the custom and finance public services.Rendering supplied by Kairos Japers - Evers & Partners

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City Link, with a fixed 12 year lease and a rental level announced as 125 EUR/m/year. I Periphery The periphery, which accounts for some 30% of stock, takes in all of the communes located around Antwerp, essentially to the south and west of the city, along the 3 motorways leading to Brussels (E19 / A12), and to a lesser extent to Lige and Eindhoven (A13 / E313 and A21 / E34 respectively). Ease of access half way along the Antwerp-Brussels motorways, along with the proximity of Brussels Airport, constitute the main advantages of this zone. Many business parks have grown up here over recent years, of which some of the most noteworthy are Delta Business Park (approx. 6,000 m) located at Kontich (Satenrozen, 1) and Naviga Business Park (approx. 11,000 m) at Zwijndrecht (Nieuwe weg 1). It is also along these axes that important industrial and logistics parks have been developed. I Mechelen Mechelen can be considered as a market in its own right, with office stock estimated at some 450,000 m, mostly spread through 3 zones (the north and south industrial zones and the centre, where the buildings are principally to be found along the Ring). It is a relatively young market with office buildings present in the city centre, but it is only over the past 15 years that more specific office buildings have begun to be located alongside the industrial zones. Mechelen can be seen as offering an alternative to the mobility problems found in Brussels or Antwerp. This city has expanded greatly over the last decade and is continuing to expand. Current developments are located close to the station with the conversion of the former Belgacom building, and in the Mechelen Noord business park, with various projects by developer Uplace. These new projects risk increasing vacancy, which currently stands at around 10% in Mechelen. Conclusions There are numerous advantages to the Antwerp office market: the presence of a port, excellent national and international means of transport (particularly to the Netherlands and Germany), a well-developed logistics network, and good balance between economic sectors (industry, offices and retail).

The business districts of Antwerp

With a stock of almost 2,100,000 m (including Mechelen) the Antwerp market is the second largest office market in Belgium, representing 10 % of the Belgian market. Vacancy levels have once again exceeded 10 %and currently stand at around 11,5 %. Prime rents by zone are as follows Port : 105 EUR/m/year City centre : 145 EUR/m/year Ring : 135 EUR/m/year Periphery : 125 EUR/m/year

Despite its reduced size when compared with Brussels, and other large European cities, the Antwerp market offers sizable advantages. The new Antwerp Headquarters initiative, a public-private partnership between the city of Antwerp and the private sector, is aiming to attract enterprises and the headquarters of international companies from the Benelux through a marketing campaign. In a preliminary version of the explanatory note of the Antwerp 2012 guideline, the city estimates that 600,000 to 781,000 m of new offices will be needed over the next ten years in order to satisfy demand. Within this context, the city is planning to follow a new planning policy for new offices which will put the accent on: encouraging the development of hubs in headquarters zones (which will mainly be concentrated around Central and Berchem stations and, to the west of the city, on the other side of the Schelde)

limiting office projects of over 1,500 m in the other zones Even if this note remains ambitious, it represents the first step towards active and strategic promotion aiming to stimulate and strengthen the Antwerp office buildings market.

Guibert DE CROMBRUGGHE, Managing Director Patrizia TORTOLANI, Senior Consultant Pascal VANHUMBEECK, Consultant De Crombrugghe & Partners IThis article is also available in French and in Dutch versions in the library of www.pro-realestate.be All articles in this online library are classified by date. Enter this date : 10/03/2010 + English title of this article. The full article can be downloaded in PDF format from the website.


OFFICES I REGIONAL MARKET TRENDS

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Dont forget the provincesA wider perspective on the Belgian office market reveals that there are more office locations than just the two largest office markets of Brussels and Antwerp. Lige, Namur and Charleroi in the southern part of Belgium and Ghent in the northern part of Belgium are enjoying a renewed interest since the decentralization trend and the traffic congestion around the main office markets.Characteristics, development and market trends. I Liege Liege, the largest city of the Walloon region with an office stock of some 465.000 m, can be divided into two broad areas. The first area is downtown Liege, on the left bank of the Meuse; the second area is situated on the right bank. More than half of the stock is situated downtown, mainly along large avenues such as Boulevard de la Sauvenire and Boulevard dAvroy. The main occupiers are public administrations and regional and provincial governments (approx. 40 %), followed by institutions (banks and insurance companies) (approx.20 %). In the periphery, the supply of suitable buildings is virtually non-existant and concentrated in offices parks such as Zenobe Gramme and the Sart Tilmant science park. Approximately 40 % of the stock is made up of secondhand buildings. The demand for offices of good quality is large in Liege but there is a serious lack of new development to meet the needs of current occupiers. Several developments are currently under consideration to solve this imbalance between supply and demand. Amongst these are the Alleur Offices Park (7.500 m of office space), the Airport Business Park (13.200 m of office space) and the Val Benoit site (previously a university campus of 8 ha now dedicated to technologies and economic activity, with a development potential of 40.000 m space). The plans of the local authority to create some 100.000 m of new office space around the Guillemins Station will also create a new impulse for the market and help bridge the gap in high-quality office space. In 2009, low regional demand for office space and, as a result, the downward pressures on rents, reflects current economic uncertainty. Cost cutting and efficient space occupation are the new focuses of corporate users. Despite this morose climate, take-up figures were relatively high in 2009 in Liege (55.800 m), thanks to an exceptional deal carried out by the Belgian Buildings Agency to let 52.700 m in a development located at Rue du Paradis 1. Despite the numerous advantages of the city (new TGV station, Liege Airport, central location and good motorway accessibility), average rents in Liege remain very reasonable compared with Brussels, varying between 100 EUR/m/year and120 EUR/m/year for new and prime space and between 80 and 95 EUR/m/year for second-hand buildings. I Namur With a total office stock of 365.000 m, Namur represents the third largest Walloon city in terms of office market. As the capital of Wallonia, its real estate market has grown over recent years thanks to the installation of administrations and ministries of the Walloon Region, which are its principal occupants with a share of some 57 % (200.000 m) of the total stock. Most of the office space is concentrated in the municipality of Jambes (to the south of Namur). In contrast with other Walloon cities such as Liege and Charleroi, the Namur office park is relatively new, most of the buildings having been constructed in the last 15 years. Because of this, the office market registers low availability levels in comparison to other regional cities like Charleroi, Liege or Antwerp. The most important developments are the Namur office park comprising a total of 10 buildings

The Paradis Tower designed by the architects Jaspers-Eyers & Partners in cooperation with Greisch Architects, forms part of the continuing urban revitalisation of the Guillemins district in Lige. The new Guillemins station and the Mdiacit shopping centre, both inaugurated in 2009, are key development projects aiming to create a link from the station to the Boverie park and Mdiacit via a bridge across the Meuse. This tower, 26 floors in height, should see light of day in mid 2013, and will be the highest tower in Lige. The project is being developed by Fedimmo, a subsidiary of Befimmo, which manages a portfolio of buildings leased to the Belgian State.photo Jaspers-Eyers & Partners

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with an area of 35.000 m and a new development by Immobel on the Boulevard Melot (opposite the station). Take-up activity remained relatively low in 2009, totalling around 7.000 m, which is in line with previous years. Average rents in the Namur area stand at 125 EUR/m/year in prime locations and between 95 and 100 EUR/m/year in second-hand buildings. I Charleroi Charleroi, whose greatest asset is its airport, can be considered as the second largest city in Wallonia with a total office stock of 380.000 m. The office market is concentrated along the main avenues such as Boulevard Tirou and Boulevard Audent where the principal occupiers are institutions (banks and insurance companies) and public administrations. These sectors represent the most important occupiers in the city with shares of some 40 % for public administrations and some 30 % for banks and insurance companies. Around 50 % of the office park is old and needs to be renovated, which explains the low rents registered in the market. The average rent for quality offices varies between 90 and 110 EUR/m/year and between 50 and 75 EUR/m/year for second-hand offices. Recent buildings are mainly located in the Aeropole, a business park close to BrusselsSouth (Charleroi) Airport and representing 96 ha and around 105 businesses, 3 research & development centres and a university research centre. The most important industrial activities include biotechnology, scientific research and call centres. The investment market is almost non-existent in Charleroi, as it can mainly be considered as an owner-occupier market.

I Ghent The Ghent office market represents a stock of 1,34 million m. The market can be divided into four districts: the centre, the northern region, the eastern region and the southern region. The centre represents some 58 % of the stock. The southern district accounts for 25% of which one third is in recent buildings. The eastern district only represents 12% of the total stock, half of this being attributed to the new buildings of the Zuiderpoort, completed in 2004. Supply increases at an average of 35.000 m a year, which remains moderate since it represents less than 3 % of total supply. Taking into account current planned office projects, stock is likely to rise by more than 310.000 m during the next decade. This represents a stock increase of more than 20%. The current low vacancy figure of around 4.2% for offices could rise if the market does not absorb this extra office capacity. Within this context it is important that take up keeps pace with new supply. Otherwise top rents, which are already lower than in some other Flemish cities, could come under pressure too. Up to now the low levels of rents (top rents vary around 135 EUR/m/year and medium rents around 109 EUR/m/year) lead to a very restricted negotiation margin for lessors or developers, and help explain the rarity of new developments in Ghent. These future developments risk generating downward pressure on the already low rental values. Nevertheless, these plans will be phased over a period of more than 10 years, implying a volume of building remaining in line with the yearly average. In 2009, the take up was slightly higher than 2008, totaling 42.900 m, which is also higher than the average take-up figures (35.000 m).

The centre accounted for the highest share of take-up. Local and regional companies currently dominate the office market, but this is likely to change in the future. The past two years has seen an increasing number of companies coming from the Brussels region or from abroad and choosing Ghent for their new headquarters. One of the reasons can be found in the absence of traffic congestion. But the city is also investing huge amounts in new projects and in marketing campaigns to attract more regional and national companies. With one of the biggest projects (The Loop with a potential development of 552.500 m of which 155.000 m of offices) it is clearly focusing on international companies. The strengths of Ghent are the presence of the university, industry and the port. The marketing plan of the city defines three headquarter zones. These are the redevelopment of the area around Gent-Sint-Pieters station where a total development of 82.000 m is planned along the Fabiolalaan. In the first phase 50.000 m will be developed beside the train station. The second and third zones are The Loop (155.000 m of office space including the MG Tower) and the Artevelde stadium (10.000 m of office space). Both of these out of town areas are focusing on integrating different functions: leisure, retail, exhibitions, work and residential. Alongside The Loop should be noted the construction of the MG Tower, a project of the Group de Paepe situated at the St-Denijs-Westrem exit from the E40. This 24 floor high tower offering 23.500 m of office space will be completed for mid 2012.

Dashboard of 2009 market trendsKey figures Brussels Antwerp Inhabitants 1 100 000 490 000 Office stock 13 455 000 2 100 000 Vacancy rate 11% 12% Prime rent 265 137 Strengths and weaknesses Localisation ++ ++ Infrastructure ++ ++ Quality of the office stock + = Qualified personnel ++ ++ Main Belgian cities Lige Namur 194 000 109 000 465 000 365 000 4% 120 125 ++ ++ = = = = ++ = Charleroi Ghent 202 000 244 000 380 000 1 340 000 4,2% 110 135 + + = = +

Guibert DE CROMBRUGGHE, Managing Director Patrizia TORTOLANI, Senior Consultant Pascal VANHUMBEECK, Consultant De Crombrugghe & Partners IThis article is also available in French and in Dutch versions in the library of www.pro-realestate.be All articles in this online library are classified by date. Enter this date : 10/03/2010 + English title of this article. The full article can be downloaded in PDF format from the website.

++ Excellent I + Good I = Average I - Poor I -- Bad


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OFFICES I DTZ AFFORDABILITY INDEX I

Brussels in strong positionIn calculating the costs to European companies of the office space they use, it is now possible to look at overall costs. The notion of Total Cost of Ownership has been current in the vehicle fleet sector for some years. The DTZ Office Affordability Index applies a similar approach to property costs. We take a look at some of the findings and speak to one of its authors.Space use One of the factors driving down overall occupancy costs in Belgium is the steady reduction of space allocation per desk that is still high in comparison to other European Countries, and as all charges are calculated on a square metre basis, costs are automatically lower. According to DTZ, however, there is still room for further optimisation in this area. On average, European services sector companies in capital cities allocate 16% of their total turnover on office occupancy costs. But there are large discrepancies, with Madrid, where added value is lower, standing at 30%, and Brussels, with high added value and low rental costs, well below average at 10.7%. However, points out Tams Polster, DTZ Head of Consulting Europe & Middle East, this doesnt mean that companies use office costs as a reason for moving from one place to another. They are located where their business needs them to be. I believe that in the location decision process, the office cost represents a mere 5-10%. In general, very he latest edition of the DTZ Office Affordability Index makes good reading for Belgium. The countrys capital, Brussels, is amongst the lowest cost cities in Europe where total office costs are concerned (see inset). The Index includes not only the headline rental cost, but other outgoings such as maintenance charges, utility costs, office taxes and certain consumables. The Index also takes in the notion of turnover or added value, using the calculation office affordability = occupancy cost per desk divided by average turnover (or added value) per employee.

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high office cost areas such as Paris or London have a very high added value per employee, so the office cost is still affordable. Nevertheless, when office costs in a particular location rise above a certain percentage of turnover, this causes a problem and leads to a market correction. In Brussels, I think this figure would be about 20%. Future trend Economic considerations meant that in 2009 headline rental levels stabilised or decreased. In Brussels, there was one deal at the magic 300 EUR threshold, but the real prime rent is about 265 EUR. DTZ believes this may slip to 250 EUR in 2010. Company layoffs in Belgium, despite hitting the headlines, have been somewhat slow to come, partly because of the high cost and complexity of shedding staff. And the effect on real estate comes later, as companies take the decision to realign their space needs with their new employment levels: Generally, companies which may see their staff levels shrink by 20%, will look for 35% less space, observes Tams Polster. So their total office portfolio occupancy cost is actually set to decrease further. In line with the increasing success of part time working the number of desks per full time employee equivalent is increasing and flexi-desking becomes a necessary means of avoiding rapid occupancy cost inflation while enhancing flexibility. Currently, due to inefficient workplace management, Belgian companies have around 1.1 to 1.3 desks per employee, but the trend is moving towards 1.0. In London as a comparison, the trend is moving toward 0.8 desks per employee. Tim HARRUP I

Tams Polster: Companies which may see their staff levels shrink by 20%, will look for 35% less space

Brussels at low end of costsOccupancy costs per workstation/added value


RETAIL

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ne of the winners in a sluggish real estate market in 2009 has been retail. This is where some of the smart money is now going. The legislation in this area is different from that for offices, and there are some new rules

on the way, with new factors to take into account, so we give you an insight into the major elements to look out for. We highlight some of the (currently rather scarce) new projects, and we take a look at rental prices in a number of different cities. This might come as a surprise to those of you who automatically thought the most expensive retail location in Belgium must obviously be in Brussels, the capital of Europe

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SUMMARY34 I Retail town planning in Belgium : modification of the criteria for granting socio-economic permits 36 I High streets the rental hit parade 37 I Shopping centres: forthcoming projects .

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R E TA I L I B E L G I A N L E G I S L AT I O N I

Retail town planning: rules forIn late 2009, the Belgian legislature transposed in extremis the European Directive prohibiting economic tests as criteria for granting permits for commercial establishments. The ongoing institutional negotiations on the transfer of the competences to the regions will now have to come to an agreement.he retail community of commercial real estate and retail had an eventful end of 2009. The Act of 13 August 2004 on the permits for commercial establishments, the so-called Ikea Act, was at the heart of all debates. The institutional negotiations concerning the regionalisation of this federal law generated a first shock wave. The second shock wave came from the uncertainties created by the federal legislature in the transposition of Directive 2006/123/CE of the European Parliament and the Council of 12 December 2006 on services in the internal market called the Services Directive.

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Andr Lombart is partner at CMS DeBacker. He specializes in retail business, acting for both domestic and foreign retail chains.

Previous system As a reminder, after 30 years under the system arising from the Act of 1975, which some called the Padlock Act, the legislator established through the Ikea Act a simplified scheme, which requires the issuance by the municipal authorities of a socio-economic permit for commercial net areas larger than 400 sqm, with an advisory opinion of the national socio-economic committee for net commercial areas larger than 1000 m2. An appeal is pending before the Interministerial Committee for Distribution, and could also be brought before the Council of State and/or courts. Within the first two years of its application, the Act, described as liberal, enabled more than 700,000 m2 of commercial areas to be settled. Until late 2009, the socio-economic permits were issued according to the following four criteria : 1. spatial location of the commercial site; 2. consumer interest; 3. effect of the project on employment; 4. impact of the project on existing businesses. The fourth criterion was, in practice, the most important one in the decision making process by the competent authorities. To secure the permit, the applicant had to demonstrate that there would be no destabilising effects on the commercial areas and the complementarity between the small and large retailers. The general opinion, however, held that linking the granting of the permit to such a criterion was contrary to the Services

Directive, which prohibits the use of an economic needs test in the granting of an individual permit. New system in force from 28 December 2009 I What is the new system? The transposition deadline of the Services Directive was due to expire on 28 December 2009. What would have happened after this deadline? The federal legislature had to respond to allay the concerns of some professionals who feared a legal vacuum that would generate uncertainties and undermine any decision to invest in a commercial project. It did so, in extremis, by enacting the Act of 22 December 2009, which adapts certain legislations to Directive 2006/123/CE of the European Parliament and the Council of 12 December 2006 on services in the internal market (the Services Directive). Article 18 of the Act, which came into force on 28 December 2009, amended three of the four criteria for issuing the socio-economic permits. Commercial establishments may now be authorised according to the following four criteria : 1. spatial location of the commercial site; 2. consumer protection (rather than consumer interest); 3. compliance with social and employment law (rather than the effect on employment);

Thomas Hauzeur is associate at CMS DeBacker. He specializes in town planning.

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r permits change

The shopping and leisure centre Just Under the Sky almost 42,000 m - is set to open in the spring of 2013 alongside the canal in Brussels, near the Van Praet bridge, on the 4 hectare former Godin factory site.Rendering Art & Build Architect / Quick it

4. protection of the urban environment (rather than the impact on existing businesses). I What to think about it? These criteria are applicable to permit applications submitted before 28 December 2009 for which no decision has yet been issued. They should in principle be specified by a Royal Order, which should be published promptly. Meanwhile, the difference between the criteria required in 2004 and those in force since 2009 is not obvious. Indeed, while the first criterion remains identical, the formulations of the second and third criteria differ slightly. In the absence of specifications in the preparatory work, their scope will only be assessed under the terms of the Royal Decree, which should specify their boundaries. However, it seems that the second and third criteria only aim at obtaining the commitment of the applicant to comply with consumer protection law, social law and employment law. The relevance of such criteria seems very relative since it is obvious that the operator of a commercial establishment must respect the above-mentioned laws. The main change lies in the substitution of the fourth criterion relating to the impact of the project on existing businesses with an evaluation on the protection of the urban environment.

A priori, one might question the difference with the first criterion on the spatial location. Nevertheless, it is well known, that in practice this first criterion focuses on an evaluation of the project in terms of mobility. Hence, the boundary, remains thin, especially since the Act does not define what protection of the urban environment means. This wording seems inspired by the Services Directive, which provides that the prohibition of economic tests as a prerequisite for the grant of authorisation should cover economic tests as such, but not requirements which are objectively justified by overriding reasons relating to the public interest, such as the protection of the urban environment, social policy or public health. As a reminder, the Directive prohibits the case-by-case economic test in relation to the economic planning objectives. This prohibition shall not concern planning requirements which do not pursue economic aims but serve overriding reasons relating to the public interest. As such, the protection of the urban environment is likely to justify the implementation of an authorisation scheme and other restrictions on freedom of establishment. There are still questions surrounding this concept since the Directive does not define it any further. At most, it is stated that this concept includes town and country planning. This finding can, however, entail problems under the rules of distribution of compe-

tences between the federal state and the regions, given that the latter possess competences related to environmental protection and town and country planning, subject to certain exceptions. The federal Act is thereby somewhat weakened. If some intend to challenge the way the Services Directive has been implemented into Belgian law through the Ikea Act, they could rely on the vertical direct effect of this Directive in an appeal against a decision granting or refusing a socio-economic permit before the courts. The vertical direct effect of a directive allows, however, only protest against public authorities. The Directive could thus not be invoked in proceedings between private companies. In any event, the response of the federal legislature is seen as a temporary solution to deal with the most urgent matters, before the transfer of competences to the regions takes place. Andr LOMBART

Partner at CMS DeBacker Thomas HAUZEUR Associate at CMS DeBacker IThis article is also available in French and in Dutch versions in the library of www.pro-realestate.be All articles in this online library are classified by date. Enter this date : 10/03/2010 + English title of this article. The full article can be downloaded in PDF format from the website.Belgium Real Estate Showcase 2010 35

R E TA I L I H I G H S T R E E T S I

Antwerps Meir leads the wayBelgium has relatively few out of town shopping centres compared to other European countries, the result of a desire to protect the city and town centre retail landscape. Traditional high streets therefore remain important both in social and economic terms. We take the pulse of the current situation where rents are concerned.he top retail high street in Belgium in terms of rental values is no longer to be found in the capital, Brussels, but in the countrys second city, Antwerp. What are the other characteristics which define the retail landscape in the country? The evolution of prime retail rents in Belgium between 2007 and 2009 reveals a somewhat mixed bag, as certain towns and cities see their attractiveness for reasons which have little or nothing to do with retail itself rise or fall.The Meir in Antwerp is Belgiums most expensive retail location

T

Rental levelsCity Antwerp Brussels Gent Bruges Hasselt Lige Namur Leuven Ostend Knokke Mechelen Mons Turnhout Kortrijk Street Meir Rue Neuve Veldstraat Steenstraat Hoogstraat Vinave dIle Rues de Fer/de lAnge Bondgenootenlaan Kapellestraat Kustlaan Bruul GrandRue Gasthuisstraat Lange Steenstraat EUR/m/ year 2009 1.700 1.600 1.200 1.100 1.100 1.000 1.000 800 800 700 600 600 550 500 400

Roeselaere Ooststraat

For typical 200 m unit with a 7 metre frontage (figures with thanks to CBRE Brussels).

This table illustrates the types of rental levels attracted by the major high streets in some of Belgiums most important cities. It shows the (logical) wide gap between the stars such as Brussels and Antwerp, and the provinces. It should also be noted that the next best locations in the largest cities (Avenue Louise, Brussels, Huidvetterstraat, Antwerp) have traditionally attracted rents around 25% lower than the main streets, which makes them still more expensive than most other locations within the country.

Prime rents Dislodging Brussels Rue Neuve from top spot over this period is Antwerps Meir, an elegantly curving street running from close to the citys Central Station right down to the historic centre of this major port city (Europes second port), some 550 metres. As the chart shows, rental levels on the Meir currently stand at 1.700 EUR/m/year, with Brussels Rue Neuve at 1.600 EUR. In 2007, the respective figures were 1.300 EUR and 1.500 EUR. This may be seen in the light of the Rue Neuve suffering some well-publicised security problems, while the Meir has witnessed a normal rental evolution. The locations showing the next largest rental values are the countrys third largest city Lige along with Gent and Hasselt, the largest towns in Western and Eastern Flanders, world heritage site Bruges and Wallonian capital Namur, rents in all of these major towns being relatively similar. Variations Not all rental evolutions have been positive over the past two years, however. Kustlaan,

the fashionable shopping street in the countrys most fashionable coastal resort, Knokke, has seen rents fall back from 850 EUR to 700 EUR. This may be partially due to the resolutely top of the range character of the merchandise on offer during these recessionary times, and may also be a reflection of the fact that the largest town on the coast Ostend some 35 km away, is very much on the up and has recently seen the refurbished Culture Palace shopping gallery added to its shopping heart. Yet going the other way is, for example, Mechelen, whose rents have risen from 425 EUR in 2007 (barely changed from 5 years earlier), to 600 EUR now. Mechelen is strategically located on the main motorway between Brussels and Antwerp, and as such has seen substantial growth as a centre for business parks over the past few years. Settled In the majority of Belgian towns, which are of considerably smaller size, and where the retail centres have remained largely unchanged for many years, rental values have also remained more settled. Towns in the table such as Roeselaere and Turnhout, provincial in nature and size, have seen little movement in prime rental values over the past two years. Tim HARRUP IThis article is also available in French and in Dutch versions in the library of www.pro-realestate.be All articles in this online library are classified by date. Enter this date : 10/03/2010 + English title of this article. The full article can be downloaded in PDF format from the website.

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R E TA I L I F O R T H C O M I N G P R O J E C T S I

Shopping centresThe opening of Mdiacit in Lige was the most notable retail event of 2009 in Belgium, but there are few large retail developments set to open in the coming years. Three major developments will are on the way, however, are located in Brussels and Kortrijk in the west of the country close to other smaller projects are all programmed for 2010 2011.image supplied by Forum Invest

Kortrijk 34,000 m Union Investment Real Estate GmbH Architect: Robbrecht & Daem Opening : 2010A basement, ground floor and two upper floors make up this ambitious project to redevelop part of the centre of Kortrijk. There is also a residential aspect to this development. Mediamarkt, Casa, H&M and Zara are amongst the tenants. K in Kortrijk was bought by its current owners prior to opening.

K in Kortrijk

Brussels 14,472 m ING REDH, Immobilire de la Toison dOr Architects : Chapman Taylor /Jaspers Eyers & Partners Opening: 2010This redevelopment of an existing centre in one of Brussels main shopping districts (Avenue Louise Toison dOr Chausse dIxelles) will be immediately visible with its new anchor tenant Fnac, whose other Brussels store occupies the whole of the top floor of city centre gallery City 2. Other retailers of note include Tommy Hilfiger and Olivier Dachkin. The UGC cinema will occupy part of the space.

Galeries de la Toison dOr

the French border. A number of

La Grand Poste

Other centres set to open in 2010-2011.I Retail Park Ninove 13,500 m Redevco I Huy, Shopping Mosan 10,600 m CCH I Retail Park Ternat 14,000 m Redevco I Chtelineau Retail Park 20,000 m, Bouygues Immobilier Belgium I Retail Park Eupen 7,000 m GL Group I Retail Park Florennes 4,000 m GL Group I Nivelles, Frun Park Le Panier Vert 14,000 m De Vlier Retail Development I Tournai, Les Bastions 10,000 m Wereldhave I Verviers, Au Fil de lEau 29,500 m Foruminvest I Namur, Lopold 16,000 m Foruminvest

Rue de la Rgence, Lige 8,000 m Invest& Corporate Architect : ATLIPLAN architects Opening: 2011

renderings : Art & Build Architect / Quick-it

Just Under the SkyBrussels 42,000 m Equilis sa Architect : Opening : Art & Build 2013This 6-building, 2-level complex gets its name from the lightweight transparent roofing which is a main feature. Located in the north of Brussels alongside the canal, it has been designed to be environmentally friendly, and to provide shopping and leisure activities representing a lifestyle. It is designed in the manner of a district whose squares and thoroughfares are surrounded by buildings. It will accommodate large, specialised retailers.


rendering Altipla

real estate certificates voir pg48

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