Wereldhave Belgium to lease more retail space but lowers profit forecast
Even if Wereldhave Belgium recorded good results during the first six months of the year, the real estate lessor lowering its profit forecasts for the whole year. After all, the retail industry is not out of the woods yet.
The demand for retail space in Belgium increased again in the first half of the year, says Wereldhave in its half year report. The take-up of stores on the Belgian market even reached its best result in ten years with 215,000 m². Wereldhave signed 43 leases and lease renewals during this period. The average rent was 2 percent higher than the old rent, reports the Belgian newspaper Het Laatste Nieuws. New tenants include Jysk, Oil & Vinegar, Hupside and Dunkin Donuts. The occupancy rate of the retail portfolio reached 96.2%.
Despite the market recovery, the lessor confirms certain trends that have been emerging for some time. The fashion industry continues to perform poorly due to declining sales and the drive to optimize portfolios. Their place in the shopping streets is more than ever occupied by supermarkets, sports and leisure stores, catering establishments and furniture stores.
Small towns are deserted
At the same time, there is a clear shift from downtown stores to stores along main roads and stores in indoor malls. The total vacancy rate remains very high, at over 11%, and is increasing mainly in the centers of small towns.
Wereldhave Belgium recorded an operating profit of 18.4 million euros in the first half of the year, approximately one and a half million euros more than a year ago. However, the company is lowering its profit forecast for the full year as the aftermath of the Covid crisis is still being felt in the distribution sector. For the moment, fun shopping is rare, and this absence will impact the turnover of the rented stores. The real estate actor is already taking into account potential compensation.