Office investment activity in Belgium has increased by 96% during H110, when comparing year on year data, with Belgium investors accounting for 75% transactions. This is according to international real estate advisor Savills.
CBD prime yields for nine-year leases stand at 5.25-5.50%, down 25 bps, while three- to six-year-leases stand at 6.25-6.50%.
Sheelam Chadha, Head of Research for Savills Belux, says: "Acquisitions from the local investment market, now peaking at 75%, have become the principal purchase group as global financing issues and euro zone fears hit cross-border investors. 2010 will be dictated by the activity of local domestic real estate funds which show no signs of reducing their exposure to Belgian real estate."
In the lettings market, take up was strong in the first quarter of the year but reduced heavily resulting in a 40% decrease reaching only 72,500 m² when comparing Q210 to Q110. The Periphery District was the most affected seeing activity down by 36% quarter-on-quarter, this is attributed to a lack of corporate activity. Leopold District meanwhile saw increases of 248% in activity when comparing quarter on quarter including a letting transaction to EPSO for 8,334 m².
Future development delivery is however slowing down and the vacancy rate stands at 12%. Quarter-on-quarter prime rents have remained stagnant at 260 m²/year but top quartile rents having increased slightly year on year by 1% have fallen quarter-on-quarter by 1.3% to 252 m²/year.