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SNAPSHOT Q3/2019: KEY ANALYTICS ON LUXEMBOURG REAL ESTATE MARKET

Sharpen your focus on what’s in industrial, office and retail real estate

Planning to invest in the Great Duchy, or looking for ways to strengthen your asset portfolio? You can’t make the right move without the right data: that’s where our Snapshot comes in.

Find out how the third quarter of 2019 has been treating the Luxembourg office and retail real estate market. Get the insights that make the difference, with an analysis of the key parameters of the local market and an outlook on everything to come – all the essentials for your business strategy.

HERE’S LUXEMBOURG: GENERAL OVERVIEW

Two things: there’s been a high increase in GDP growth – up to 3.1%! –, all the more impressive as the IMF forecasts a downturn for the global economy at the same time. Unemployment rates remain low at 5.4%, cross-border workers are on the rise and the country’s blessed with a solid economic foundation.

Strong population growth is expected in the coming years. Household spending will decrease a bit, but will still remain significantly higher than in neighbouring countries.

READY, SET, SNAP! OFFICE MARKET SNAPSHOT

We’ve seen strong take-up in the third quarter, which has given the total activity for 2019 quite a boost. Several significant transactions were carried out, including the largest one of the year so far.  Vacancy numbers remain at 3%, one of the lowest levels ever recorded. Prime rents remain stable throughout the Great Duchy.

On the investment front, activity was pretty slow in the third quarter, with only one transaction recorded. There are still some transactions in the pipeline that should close before the end of the year though – which brings us to the outlook for the Luxembourg office market.

If these transactions close in the next quarter, 2019 might outdo the 2018 numbers. Office stock is expected to increase in Q4, and so is the investment volume.

READY, SET, SNAP! RETAIL MARKET SNAPSHOT

Thanks to significant transactions on the retail market, over 100,000 square metres have been recorded this year, making 2019 the best year on record. But there’s still a gap between supply and demand, with some retail units on the high streets still vacant. Prime rent has stabilized, and will most likely increase slightly in the coming months in some areas.

On the investment side, it was radio silence: no transactions were recorded. Opportunities on the market are scarce, which limits investment activity.

The retail industry will continue to benefit from the country’s strong economic foundation, but there’ll be a growing need to adapt to the increasing competition from online retail and evolving consumer habits.

Contact our team for more info about : Snapshot Q3/2019 – Key analytics on Luxembourg real estate market

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