Sale of the last Corporate Village building to CB Richard Ellis Investors
Increased interest of international investors for Brussels periphery
CB Richard Ellis advised Airport Garden SA in exclusivity in the sale of 100% of the share capital of Avignon NV holding as main asset the Avignon building located Da Vincilaan in 1930 Zaventem to CB Richard Ellis Strategic Partners Europe Fund.
The Avignon building is part of the largest and the most state of the art business park in the Brussels periphery, along the ring nearby the airport. This office project constitutes the last development scheme of the successful Corporate Village.
The Corporate Village offers a unique work environment: the easy access, the state of the art technical equipments and the green surroundings of the complex.
The Corporate Village features over 75.000 m² of office space divide over 6 independent buildings. The site benefits also from the integration of a four-star hotel & conference centre of some 300 rooms.
The Avignon project will be the biggest building in the park with 18.563 m² of office space, 767 m² of archive space and 329 parking places. The project will be delivered by mid 2009.
CB Richard Ellis Strategic Partners Europe Fund is a Luxembourg investment fund created by CB Richard Ellis Investors and subscribed by American pension funds with a view to invest in real estate assets in continental Europe. The fund has already invested EUR 750 million in real estate assets in France, Italy and Germany.
Several international investors interested in this operation and identified by CB Richard Ellis were put in competition on this file. According to Maxime Xantippe, Managing Partner of CB Richard Ellis, “the interest in this file is representative of the attraction for the Brussels periphery as diversification tool in the markets where yields on real estate transactions in European city centers are highly under pressure.”
The volume of this transaction is of ± EUR 50 million.
According to Maxime Xantippe, “this transaction shows the interest of international investors for the Brussels periphery, in spite of relatively high vacancy rate. This transaction is a win-win for both parties. It allows the developers to finalise successfully an operation started 10 years ago and allows the investor to realise a transaction given him superiors to the average yields in comparison with returns get in other European markets with the same type of risk.”
The Airport micro market is located around the main access towards the Zaventem National Airport, where the Brussels ring road and the “Autoroute Bruxelles-Zaventem” intersect. The area totals 345.000 m² of office stock consisting mainly of high-quality modern business parks. Such business parks are the Corporate Village, the Pegasus Park, the Twin Squares and the Hermes Square. Office buildings are generally in between 5.000 and 20.000 m² and bundled in fully featured business parks.
The Aiport micro market has proven to be highly successful in attracting large international corporates. The main occupants are Microsoft, Aventis-Sanofi, Sony, SN Brussels Airlines, Deloitte & Touche, Toyota, 3M, DHL, Elia, Hewlett Packard and Honeywell. The popularity of the Airport office cluster results from the access to the Brussels ring road, direct access to the National Airport and good accessibility by train. While the airport micro market is still a reasonably young market, we expect it to grow into the largest headquarter zone in the Brussels office market over the next decade. This, as a result of the lower office taxes payable in the Flemish region.
While the overall periphery suffers from a vacancy rate of 19.09%, the Airport micro market vacancy rate is at only 8.45%. Micro markets who offer older office buildings (e.g. Keiberg) or office buildings with less visibility (e.g. Medialaan) typically suffer from higher availability.
Over the last few years, speculative development has been extremely low in the Periphery Area. Demand for office space was on the other hand well supported. Demand for grade A office space in particular was strong. As a result, the amount of readily available good-quality office space has been gradually declining.
Due to the lack of available grade A office buildings in the Airport micro market, rents have been well supported with the highest rents recorded at 165 euro/m².
The number of offices combining a good visibility from the Brussels ring road, together with a direct link towards the National Airport is scarce. Therefore offices such as the Corporate Village, with a tailor-made access road and transport facilities to the airport, trade at a premium towards the market.
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