Vacant units in main streets are almost inexistent.Rental values in prime locations remain stable.
“The vacancy rate in the best retail locations of the country is close to zero”, explains Karl Van Oosterwijck, Partner at Cushman & Wakefield, leader of the Belgian real estate advisory market, in reaction to alarming vacancy figures recently published by Locatus in the Belgian press. “Companies specialising in this type of inquiries base their figures on units which are visually vacant, which means these figures include units which, although having already found a tenant or a buyer, are still waiting for some permits or for their redevelopment to be completed. Everybody knows that stores located in main streets are moving or undergo some temporary refurbishment on a regular basis. The vacancy figures recently published in the press can be mainly explained by what professionals call ‘friction vacancy’. Furthermore, these figures express the vacancy city by city, and do not discern prime locations from secondary locations, or even third-rank locations.”
According to Cushman & Wakefield’s figures, only 9 units are to let in the country’s prime locations top-12, which equals to a vacancy rate of 0,02% (expressed in sq.m.). In these streets, the demand from national and international retailers does not decrease. The same observation is valid for the main shopping centres and the qualitative peripheral retail locations in the country.
“The performances in the Belgian retail market for the year 2009 were relatively good. Whilst other European countries underwent more severe corrections in their rental values, retail rents in Belgium remained stable. The automatic indexation of salaries combined with the 2009 deflation episode led to an improvement in the overall purchasing power, which translated into turnovers that were fairly satisfactory”, comments Koen Nevens, Partner and Head of Retail Warehouse. “Secondary locations may have suffered from the crisis a bit more, yet there is no valid reason to expand this observation to the entire high street market, especially as far as the most prestigious and best performing locations are concerned”.
Cushman & Wakefield’s Belgian office was involved in 40% of the retail transactions in the country.
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