Two things: there’s been a high increase in GDP growth – up to 3.2%! Unemployment rates remain low at 5.3%, 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. Private consumption should continue to drive growth and inflation is set to remain contained due to lower energy prices and transport becoming free in March 2020.
Office
We’ve seen strong take-up in the last quarter, which has given the total activity for 2019 quite a boost. Several significant transactions were carried out, including the largest one of the years so far. Vacancy rate remains at a historically low 2.97%. Prime rents saw an increase in the CBD and in the periphery.
On the investment front, the total office investment volume for the year reached record levels with only 18 transactions recorded.
OUTLOOK FOR 2020
Letting activity is expected to keep up the momentum with some large transactions still expected. Then Luxembourg has been considered as a “Brexit Winner” and should continue to attract UK-based companies looking to relocate.
Retail
On the investment side, it was radio silence: no transactions were recorded. Opportunities on the market are scarce, which limits investment activity.
OUTLOOK FOR 2020
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. Worth mentioning as well the positive dynamics of sectors such as jewellery, optic and supermarket chains.
