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A quiet year for Ghent's office market but it remains a corporate favourite

(Image: visit flanders)
(Image: visit flanders)

A few years ago Ghent was the star of the Belgian office markets, and take-up by corporates rose every year from 2013 to 2017, with administrations accounting for a tiny fraction of the total (except for 2017). So what is the situation now? Firstly, in its end of year report, up and coming broker Belsquare said that clients are repeatedly saying ‘if you can find something suitable in Ghent, it’s for me’.

Taking a detailed look, broker JLL analyses the market in its ‘Flanders Report Winter’. It finds that occupier activity in Ghent last year was constrained by economic uncertainties but the lack of new products available also plays a role. In the nine-month period take-up amounted to 35,665 m², in line with the 5-year average over the same period, but 8% short of the first three quarters of 2017.

JLL recorded more transactions (70) which compares favourably to the 67 recorded on average over the past 5 years. Average deal size came in at 510 m² and exceeds the same period in 2017 by just 1% while being 2% below the 5-year average.
The volume in 2018 was influenced by the acquisition by the ‘Vlaams Instituut voor Biotechnologie’ of 12,000 m², but apart from this transaction the occupier market was quiet. As in the recent past, projects easily find tenants, Randstad took 1,158 m² in a new project located Brusselsesteenweg in Melle (South), and earlier this year Wijs and Jabla took 2,069 m² and 1,258 m² respectively in the new Forum development by Alides in the Centre.
The vacancy rate in Ghent remains very low at 4.01% against 4.46% as of the end of 2017 and there was 51,000 m² available as of the end of the third quarter 2018 against 55,000 m² one year ago. Prime rent in Ghent stands at € 155/m²/year, which is the same level as Antwerp, but just about half the rate in Brussels.

What is the attraction of Ghent for corporates? We may surmise that a number of factors come into play. Firstly, as in all real estate domains, location is critical. In this respect, Ghent has much to offer. Just like Brussels it is at an east-west/north-south European motorway junction. It is around half an hour by non-stop train to Brussels South station and it is, of course, part of the crucial Brussels-Antwerp-Ghent golden triangle. Next, the quality of life in this ancient European city is well-appreciated, an increasingly important factor in the work-life balance equation. To these factors can be added the calmer atmosphere than Brussels or Antwerp, the relative lack of congestion, and the above-mentioned cost of space, compared to Brussels at least. And a look across the skyline does not reveal high-rise buildings

Tim Harrup

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