The Brussels office rental market is primarily driven by flexible providers of office space and pre-let deals. In 2018, the take-up in Brussels was over 361,000 square metres and a lot of this came from flexible office operators whose demands accounted for almost as much as 20% of the annual take-up. This was compounded in 2019 by an increase in pre-lets caused by a shortage in prime office availability. This trend is set to continue in 2020 and beyond.
One of the key strategies employed by Brussels companies that require office space is to rent real estate that is geared towards creating the best possible working environment for their employees. These spaces prioritise sustainability and the ability for social interaction to drive employee happiness. However, these desirable traits are hardest to find in modern buildings unless planning takes these needs into account.
Where do things stand in 2020?
At the start of 2020, the vacancy rate across the whole of Brussels reached as low as 7.7%, down from 8.2% from the beginning of 2019. This follows a decrease in the supplied space – only 1,027,500 square metres – with the lowest ever empty premises rate of 3.5% for vacant offices. This comes despite the completion of several construction projects from 2019 continuing into 2020, and vacancy rates are expected to fall further. Nearly half of the space that will be constructed has already been rented out. The prime rental rates sit above €300 per square metre with the average rent tracked as €180+.
What is to come over the next few years?
As the decade continues, the office rental vacancy rate in Brussels is expected to fall further, reaching lower than 7% by 2021 and lower than 6% by 2022. This is with the expectation of continued real estate development driven, in part, by large investments from firms located in South Korea. Each year has seen an increase in foreign investment – there have been increases as high as 33% with each year in real estate – but the increase in demand for rental space continues to outstrip the supply.