The Luxembourg retail industry has had one of its best years since 2010 when it comes to pricing and occupancy per square metre of commercial real estate.

(E)-commerce in Luxembourg – The market share of e-commerce is growing, but physical trade remains the most significant and still has a great future in Luxembourg. The retail industry in Luxembourg has just recorded one of its best years of commercial real estate delivery since 2010.

“The retail market in Luxembourg has peaked in the last couple of months. The industry reached a total occupancy of 32,000 square metres in 2018 – an 11% increase compared to 2017 –, with a forecast of further significant growth in 2019. E-commerce certainly has its influence, but physical trade still has a bright future ahead of itself in Luxembourg. Several major projects are planned for 2019, like the Royal-Hamilius in Luxembourg and Cloche d’Or, which will welcome new names onto the market”, explains Virginie Chambon, Head of the Retail Agency at Cushman & Wakefield Luxembourg.


E-commerce has undeniably had an impact on the retail industry in Luxembourg. Eighty percent of all 16 to 74 year olds ordered goods online in 2017, which is more than in Belgium (60%), France (67%) and Germany (75%). Only the United Kingdom surpassed that number, with 82%.

Retail parks have been less affected by customers’ taste for e-commerce, thanks to their easy accessibility and more affordable letting prices, unlike city centres that have been harder hit, and where parking is scarce and letting prices are higher on average.

At a specific industry level, physical luxury commerce is standing its ground, just like the Food & Beverages sector. Luxury commerce in larger cities, in particular, stands to gain from higher tourism numbers and the fact that larger luxury houses offer a unique shopping experience through their spectacular concepts and solid image. As for the Food & Beverages sector, it offers taste and sensory experiences with which the Internet can hardly compete. The diversity and specific nature of the sector also contribute to its sheltered position.

…claiming that e-commerce has prevailed over physical trade simply isn’t correct.

Virginie Chambon – Head of Retail Luxembourg – Partner

Virginie Chambon draws Luxembourg retailers’ attention to the effects of e-commerce on physical trade: “The market share of e-commerce is still growing, that’s a given. However, claiming that e-commerce has prevailed over physical trade simply isn’t correct. The latter still has the largest market share, but it needs to adapt in order to survive. For example, there’s been a decrease in the number of stores, but an increase in their size. For brands, standard stores just don’t cut it anymore. They’ll have to offer their customers genuine and exceptional experiences.”

“We’ve entered a new era of commerce and trade, and consumers’ needs and consumption patterns have changed. Adapting to these trends is the wise thing to do”, says Virginie Chambon.


Nevertheless, the retail industry in Luxembourg still has some good year ahead. The sector reached a total occupancy of 32,000 square metres in 2018, one of the best years since 2010. The letting total in 2017 was 28,775 square metres, making this an 11% increase. That trend will consolidate in 2019, with the planned delivery of several large projects such as the Royal-Hamilius, Infinity and Cloche d’Or.

In 2018, no less than €92 million were invested in Luxembourg’s retail industry. Prime rents (1) were stable overall. However, for city centres, the trend reversed over a year ago, with a drop in prime rents for the first time in 20 years. Rents on the Grand Rue cost an average €2,160 per square metre per year, compared to €1,080 on the Avenue de la Gare. These rents match those of other European capitals. Rents in Luxembourg are still much lower than rents in London which are eight times higher, at €16,000 per square metre per year.

The Luxembourg retail sector occupies a total of 650,000 square metres (2). Shopping centres account for 48% of this space, while retail parks and high streets each make up 26% of the total. Luxembourg counts 1.10 square metres of retail real estate per inhabitant, which is lower than the average in neighbouring countries. In Belgium, that’s 1.6 square metre per inhabitant, and 1.68 in The Netherlands.

“The Luxembourg retail market still has good development potential, given the strong demographic growth expected and the positive economic indicators. Although some worried about possible market saturation, our report shows that this has not materialized – especially when we compare ourselves to neighbouring countries”, concludes Virginie Chambon.

(1) Prime rent is the highest rent paid for the best buildings.
(2) This figure represents the occupancy of retail parks, high streets and commercial centres. Independent retailers are not included in this figure.

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Virginie Chambon

Head of Retail Agency Luxembourg - Partner