Share: Share on Facebook Share on Twitter Share on LinkedIn I recommend visiting to read:%0A%0A {0} %0A%0A {1}
COVID-19 and the logistics market COVID-19 and the logistics market

COVID-19 and the Belgian logistics market

Bart Vanderhoydonck • 26/11/2020
In this series of articles, we analyse the impacts of COVID-19 on the Belgian logistics market and how it will shape the market in the future.

Belgian Logistics Investments
The trends that have emerged from 2020 and impacted the market


Due to COVID-19 and its negative impacts, 2020 will be a year most people will want to forget in a hurry – less so the movers and shakers of Belgian logistics. Indeed, logistics real estate assets became a somewhat unexpected safe haven in 2020 once the global pandemic displayed no signs of slowing down. 

In this context, we look a little further into some investment trends which have shaped the market as a result of this whole new situation.

It starts with changes in consumer demand…

Due to successive lockdowns (including the mass closure of retail), and factors such as a willingness to avoid crowded spaces outside of containment situations, Belgian consumers shifted massively towards online retail. Retailers are reacting accordingly leveraging omnichannel strategies, integrating online sales, now no longer the exclusive realm of e-commerce players as we reported recently in our most recent dissection of COVID-19’s impacts in the Belgian retail market.


…followed by increased occupier demand.

As consumer demand for such services grows, so does occupier demand for logistics facilities.
This in a market where vacancy was already close to non-existent; supply and demand for quality buildings was already subject to imbalance in favour of the former; and speculative projects have been few and far between, a consequence of the scars left behind from the GFC crisis in 2008 and onwards.

In turn, increased investor demand ensued, and prospective buyers are jostling to snap up assets at yields which would have raised several eyebrows pre-pandemic. 

High investor demand ensues and impacts prime yields

Increased occupier demand, low vacancy and the decreased risk environment thanks to strong end-user demand makes for very attractive assets. Furthermore, with few assets for sale on the market, the unprecedented investor demand noted in Belgian logistics real estate means more competition to acquire sheds. Consequently, prime yields have compressed at speed throughout 2020 - currently at 4.90% for assets with regular lease durations. Spreads with more conventional asset classes have reduced as a result:
  • 115 bps in Q3 2019  to 90 bps today (offices) 
  • 175 bps in Q3 2019  to 115 bps today (retail)

Belgium CRE prime yields per asset class

Furthermore, there is substantial evidence of much more aggressive yield levels being registered for assets with slightly longer lease durations.

In 2021 this trend is expected to continue with spreads forecasted to reduce further to 15-25 bps, and our current forecasts indicate that logistics prime yields will be on a par with prime retail from 2022 at 4.25%.

A market propelled by big tickets

As much as competition has increased for Belgian warehouses, certain potential acquirers do require specific conditions to be met.

"Big investors will look for tickets as from EUR 35 million, but most investors will look at assets as of 15 to 20M in Belgium." - Bart Vanderhoydonck, Head of Industrial Agency. 

A handful of marquee deals have already taken place in this regard in 2020. Investments in the EUR 35 million + bracket amount to close to EUR 240 million on their own out of EUR 280 million so far this year. 

  • Most recently, two separate acquisitions by GLP External Link (a newcomer on Belgian shores) were carried out in Ghent (North Sea Port) and Willebroek (Tri Access Logistics), totalling close to EUR 70 million.
  • This year’s largest transaction was Prologis’ purchase of a portfolio spanning five locations from AG Real Estate External Linkfor approximately EUR 125 million

Belgium logistics - invested per asset volume (EUR million)

  • At least one more large investment transaction of more than EUR 50 million is expected to be closed before the year end, with investor appetites growing as we transition into 2021.

2021 and beyond

Our forecasts see no signs of demand weakening next year. New consumer trends have rapidly been engrained; hence logistics is all the more appealing that its risk profile has decreased. This to the extent that several developers and investors (local and international) are considering making the move into logistics from other segments of activity such as retail and residential, transitioning from entirely different asset classes such as residential and retail in some cases.



April 2020


While logistics have been subject to more mainstream coverage in recent weeks, we check in with our Head of Industrial, Bart Vanderhoydonck.

 What the forecasts tell us

As per Oxford Economics, fundamentals with ramifications on the Belgian logistics market such as household spending (-1.3%) and exports (-1.7%) are forecasted to “nosedive” in 2020, particularly in H1 due to containment measures in place. Indeed, consumption is dropping, albeit is expected to rebound rapidly once said measures are lifted and household spending is projected to further rebound to the tune of 4.1% in 2021.

Supply Chain Supply chain

The current direct impact on the supply chain
Hence the supply chain is disrupted as a result of decreased overall demand which is nevertheless offset by increased demand for certain types of goods. In Belgium, this has translated into an increase of demand for dry products (+40%) and e-commerce (+70%) over the first two weeks of March according to Comeos (Belgian commerce and services association) as well medical and pharmaceutical goods amongst others.

Naturally, as Belgium’s main international trade hubs, ports and airports have been playing a crucial role. Indeed, the Port of Antwerp reports no drop in the volume of shipping, with confirmed growth in demand for long-life foodstuffs, pharmaceuticals and e-commerce. Furthermore, the Port of Zeebrugge plays a crucial role in the supply chain of food, medicine and critical components, albeit while recording delays and abnormal operational results.

Meanwhile numerous pictures of airlines filling the seats of passenger plane with cargo to meet demand have been doing the rounds on the web. Likewise, certain 3PLs have reported jumps in orders resulting in increased truck departures and more loads per vehicle.

In Belgium, Liège Airport has been the subject of almost daily coverage and scrutiny in the media in relation to the delivery of food and medical supplies (including testing kits and 15 million masks – some of which have been donated by Alibaba founder, Jack Ma) from China for which it forms a crucial trade export hub into Europe.

What's next and opportunities to rethink the market

"As far as consequences on the Belgian logistics real estate market are concerned, there will certainly be a dichotomy. On the one hand, certain types of occupiers handling goods such as foodstuffs and medical supplies are faced with an immediate and urgent demand. There have in fact been reports of planned lettings been pushed to start earlier than set out in the original lease agreement in light of the current circumstances. On the other hand, there are occupiers that will be facing serious cashflow issues due to business being put on standstill for a critical amount of time." - Bart Vanderhoydonck, Head of Industrial Agency

The role of short-term lettings and flexible storage solutions, as well as the role of automation is as a result coming to the fore as the sanitary crisis provides an opportunity to rethink ways of alleviating pressure on all concerned occupiers and owners alike.

"The time is also ripe to contemplate city-level strategies around urban logistics and improved storage locations in closer proximity to the end-user. The benefits from easier deliveries carried out in cities due to reduced traffic over the past weeks should push this up the agendas of policy-makers agendas post-COVID-19." – Bart Vanderhoydonck

Opportunities also exist on the investment front, sale & leaseback operations can provide cash-strapped owner-occupiers with a sustainable alternative to maintain focus on their business.


Related articles

The future of the Belgian office market
Insights • Workplace

The future of the Belgian office market

Some updated insights on the Belgian office market. 
Antoine Brusselmans • 16/11/2022
The future of the Belgian Retail Market

The future of the Belgian retail market

Some updated insights on the Belgian retail market. 
Jean Baheux • 09/02/2022


Get in touch with one of our professionals.
With your permission we and our partners would like to use cookies in order to access and record information and process personal data, such as unique identifiers and standard information sent by a device to ensure our website performs as expected, to develop and improve our products, and for advertising and insight purposes.

Alternatively click on More Options and select your preferences before providing or refusing consent. Some processing of your personal data may not require your consent, but you have a right to object to such processing.

You can change your preferences at any time by returning to this site or clicking on Cookies.
Agree and Close
These cookies ensure that our website performs as expected,for example website traffic load is balanced across our servers to prevent our website from crashing during particularly high usage.
These cookies allow our website to remember choices you make (such as your user name, language or the region you are in) and provide enhanced features. These cookies do not gather any information about you that could be used for advertising or remember where you have been on the internet.
These cookies allow us to work with our marketing partners to understand which ads or links you have clicked on before arriving on our website or to help us make our advertising more relevant to you.
Agree All
Reject All