Antwerp's industrial property market continues to grow rapidly, despite the shortage of space.
Cushman & Wakefield Belgium opens a new office in Antwerp
Brussels, 10 July 2019 – The Antwerp industrial market, which is Belgium's largest, is still exhibiting remarkable growth, even if very little space remains available. This has emerged from a report authored by property consultancy and service provider Cushman & Wakefield Belgium. Since 2010 the semi-industrial take-up in Antwerp has broken new records almost every year, while logistics property has also shown a healthy growth, with its take-up growing 145 percent last year. Cushman & Wakefield Belgium are aiming to take full advantage of the strong growth in the industrial property market, which is why it has opened a new office in Antwerp. The future of the industrial property market is assured, says Eric Van Dyck, CEO of the new branch.
145% growth in logistics take-up
The Antwerp industrial property market is the biggest in Belgium, and at present the city has three million square meters of semi-industrial storage space and seven million square meters of logistical warehouse space. Together that accounts for 27 percent of the total Belgian industrial property market, with Flemish Brabant and the Mechelen-Willebroek region the runners-up at 3.6 million and 3 million square meters respectively.
Over the last five years the logistics property market has exhibited an extreme but capricious growth. Last year the logistical take-up skyrocketed, with an overwhelming growth of 145 percent. In the last five years an average of 83,000 square meters in logistical space has been occupied, peaking in 2016 with a total occupancy of 180,000 square meters. Antwerp is moreover responsible for around ten percent of the total logistics take-up in Belgium.
The semi-industrial property market has in turn shown a reliable and dynamic growth. The semi-industrial take-up in Antwerp has itself broken a new record almost every year since 2010, thanks to a favourable economic climate. In fact, last year the occupancy of semi-industrial buildings in the city rose by a quarter, and on average 134,000 square meters of semi-industrial space is occupied each year in Belgium, reaching its peak last year with 155,000 square meters. The district of Antwerp accounts for 15 percent of all annual semi-industrial activities in Belgium.
'The need for semi-industrial property and warehousing is set to stay'
What this all means is that the Antwerp industrial property market is exhibiting striking growth, as is also clear from rental prices. At present you will pay 48 euros per square meter per year for the latest modern logistics buildings in Antwerp, the second highest prime rent in Belgium after the airport area in Flemish Brabant. Meanwhile, for the top semi-industrial warehouses you will now pay 57 euros per square meter per year, the highest sum since 2012.
Cushman & Wakefield Belgium believes that the future of the industrial property market in Belgium is very promising. 'On the basis of the results for the first quarter of 2019, we can cautiously predict that 2019 will once again be an extraordinary year,' says Shane O’Neill, Senior Research Analyst at Cushman & Wakefield Belgium. 'Estate agents can pick up the loss in retail to e-commerce through semi-industrial and logistics space,' Eric Van Dyck adds. 'Flanders is an SME market and the need for semi-industrial property and warehousing is set to stay.'
A boom in semi-industrial parks
There is a major difference in the types of tenants one finds in logistics and semi-industrial warehouses. Logistical storage in Antwerp is primarily leased to suppliers, who were responsible for 63 percent of the total logistics occupancy between 2014 and 2018. Retail and manufacturing companies tie in second place, with 15 percent of the total logistics take-up. The considerable proportion of suppliers does not come as a surprise, given that most of them have historical roots in cargo handling in the Port of Antwerp.
What is notable about the semi-industrial market is that tenants tend to buy the buildings they occupy. Over the last five years exactly half of the occupied semi-industrial buildings in Antwerp were bought by their tenants. A typical semi-industrial tenant is an SME in need of warehousing for storage purposes, for small-scale industrial manufacturing or even as a showroom. 'SMEs gain from the strategic location of Antwerp and the excellent connections with Brussels and Ghent, with those cities making up the economic golden triangle of Belgium,' says Eric Van Dyck. 'That is why there is also a boom in semi-industrial parks in Antwerp – just think of Aartselaar, Kontich, Wilrijk and Wommelgem.'
'A victims of its own success'
The Antwerp industrial property market is being plagued by an imbalance between demand and supply. In Antwerp, companies are mostly seeking modern and new warehouses (what are known as Grade A buildings), but are having to deal with aging storage space. No less than 72 percent of all logistics infrastructure in Antwerp is made up of Grade C warehouses. 'The biggest challenge the Antwerp industrial property market is facing is to raise the pipeline to new, more modern warehouses,' says Eric Van Dyck. 'That pipeline is presently limited as there is very little space available to develop new strategic industrial projects. In this way, Antwerp has become a victim of its own success.'
New Cushman & Wakefield Belgium office to open in Antwerp
Cushman & Wakefield Belgium has not missed the growth of the logistics property market in Antwerp either, and the property consultancy and service provider consequently decided to open a new office in Antwerp South so that it could improve its focus on the semi-industrial and logistics market, in conjunction with the market for office space. 'We were already talking about opening an office in Antwerp 25 years ago, but at the time we concluded that the circumstances were not optimal,' says Eric Van Dyck. 'But times have changed and we have seen companies increasingly looking to set up shop in city centres such as Antwerp, in view of mobility.'
Head of Marketing & Communication