realnews summer 2012

Professional Real estate

SummaryElise Building ata glance

Editorial Our current offers Key figures

Glossary Our special feature:

Focus on Elise Building

REALCORP Luxembourg22, Avenue Monterey, L-2163 LuxembourgTel: +352 26 27 29

w w w . r e a l c o r p . l u

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Luxembourg – Summer 2012

NewOpportunity

Non- contractual document

office space in Sandweiler, which RealCorp helped

them select as conveniently accessible from their

existing Luxembourg offices.

To assist client representatives whose primary func-

tion is not property management, but who are tasked

with or contributing to the effort to find appropriate

office space, this newsletter introduces a Glossary of

terms commonly used in Luxembourg commercial

property transactions. We hope you find this helpful,

and we welcome suggestions for more definitions.

Greg and Alain continue to search out and value

new development opportunities in Luxembourg.

Since we have grown our specialisation in Land &

Development, our sourcing capability is greatly ex-

panded. We now produce full financials and invest-

ment memoranda for financing, as well as critical

Development Analysis, due diligence and appraisal

reports. We anticipate significant joint ventures and

strong mandates with landowners and investors.

As the summer approaches (however reluctantly!)

and children look forward to vacations, our thoughts

inevitably turn to sun, water, and the lighter things of

life. Wherever you are, geographically, in your busi-

ness, and in your personal life, I hope that August

brings you times of relaxation, reflection and new in-

spiration to drive the changes you would like to see.

The RealCorp office remains open during this sea-

son and we’ve ensured that someone will always be

here to discuss ideas and help you explore new pos-

sibilities in property investment.

Michael ChidiacManaging Director

… Or are there other options? Are you one of those who

are thinking smarter in the current market? It certainly

offers us many opportunities for creative thinking! The

basic goals of business—to maximise profit, to minimise

costs, and to keep on growing— haven’t changed. But

the rules of the game have, or, at least, are in a state of

flux. This means that we need to consider options that

we haven’t tried before, compare several opinions and

take the right expert advice to sharpen our strategies

and to increase the productivity of all existing assets.

It also means that we need to value and motivate the

people in our organisation even more, to empower and

inspire them to pull together in that effort. One impor-

tant component of staff morale is their physical working

environment. RealCorp has several properties for sale

and for rent which can inspire as well as facilitate pro-

ductivity. As always, our newsletter brings you a sample

of our Current Offers (pp 3-9), more of which may be

found via the Property page of our website.

This month we would like to draw your attention to the

attractive Elise building in Leudelange. Our Feature arti-

cle on pp12-13 explains the meaning and value of the

Luxembourg-specific Valideo certificate proudly sport-

ed by this environmentally friendly building. The Techni-

cal Specifications include—amongst all the usual high-

spec requirements for a Luxembourg office space—a

central atrium, acoustic barriers, automatic blinds, rain-

water recovery, bicycle parking and changing rooms.

This is a practical office space with a feel-good factor

that could be just the key to maintaining morale and

motivating positive action in difficult economic times.

In the Key Figures section (pp10-11), our notes and

graphs on commercial real estate Take-up reflect stabil-

ity in both Demand and Supply against Q2’s fairly grim

economic context, which we summarise with support-

ing statistics from STATEC. We suggest some reasons for

this stability and offer examples of the Q2’s transactions.

One heartening example of both growth and intelligent

strategy is the recent expansion of the LAB Group into

3638sqm of additional warehouse and 300sqm of extra

Editorial

22, Avenue Monterey, L-2163 Luxembourg, Tel: +352 26 27 29 www.realcorp.lu

Non- contractual document

p.2


To Buy or not to Buy, is that the question?

To let Type: OfficeArea: 347 sqmDiv.: N/AAvailability: ImmediateHigh-standard offices in a top-floor duplex, in the pedestrian area.

ref.: 302259

Current Offers


To let Type: OfficeArea: 2059 sqmDiv.: 396 sqmAvailability: ImmediateHigh-standard building, locat-ed on Bd. Royal. The premises are fully air-conditioned and benefit from good lighting and flexible floor.

To let Type: OfficeArea: 1072 sqmDiv.: 200 sqmAvailability: ImmediateIn a green setting, close to motorways and train station, these buildings offer several floors for office use, some with terrace.

To let Type: OfficeArea: 368 sqmDiv.: N/AAvailability: Q3 2012New building, well-located, very high quality fittings, BREEAM certification, flexible floor planning, parking.

To letType: OfficeArea: 2116 sqmDiv.:N/AAvailability: Sep-12

Independent building with atypical architecture, ideally located. The spaces are ideally fitted and offer good natural lighting.

Cent

ral B

usin

ess D

istri

ct

ref.: 204504

ref.: 203490 ref.: 280749

ref.: 203555

Non-contractual document

To letType: OfficeArea: 272 sqmDiv.: Contact usAvailability: ImmediateTotally refurbished office/retail space on the ground floor of a building ideally located close to all ameni-ties. Wide window display, public parking. Approx 63 sqm of archives.

ref.: 203451

p.3


NEW

Central

Location

Last floor

available

NEW

To letType: OfficeArea: 3000 sqmDiv.: 484 sqmAvailability: Contact usNew building ideally located in front of the Station. The office and retail spaces are easy to fit and benefit from high standards.

ref.: 204107

To letType: OfficeArea: 748 sqmDiv.: 145 sqmAvailability: Dec -12Ideally located in the Bour-bon area, this office building has good standards, and has been entirely refurbished.

Current Offers

ref.: 295372


Bour

bon /

Stat

ion


To let Type: OfficeArea: 308 sqmDiv.: 97 sqmAvailability: ImmediateBrand new building located on the Plateau Petrusse, of-fering office floors of high standard, well-arranged and bright.

ref.: 222621

To let Type: OfficeArea: 281 sqmDiv.: N/AAvailability: Q4 2012Very good location, close to the train station, two separate entrances, open space to be partitioned, kitchenette. Parking available.

To let Type: OfficeArea: 1158 sqmDiv.: 259 sqmAvailability: ImmediateBrand new building close to all amenities. The premises are well-arranged and in very good condition. Parking and archives are also available.

ref.: 207633

ref.: 210655

NEW To let

Type: OfficeArea: 691 sqmDiv.: 250 sqmAvailability: ImmediateIn a renovated luxury building, we offer the rental of offices with high quality services.

ref.: 204005

LastFloors

p.4

Ideal Place

to work in


To let

ref.: 275211

To letType: OfficeArea: 610 sqmDiv.: N/AAvailability: ImmediateThis 4-storey building offers bright office spaces looking onto a large inner courtyard with trees and grass. A very quiet location close to all amenities.

Current Offers

ref.: 208267


Gasp

eric

h / H

owal

d / Le

udel

ange


To let Type: OfficeArea: 417 sqmDiv.: N/AAvailability: ImmediateNew buildings, generous parking allowance, high quality standards, BREEAM certified.

ref.: 205508

To let Type: OfficeArea: 324 sqmDiv.: N/AAvailability: ImmediateThis high standard office build-ing is very well located, and offers easily partitioned spac-es which can be split from 10sqm.

To let Type: OfficeArea: 5200 sqmDiv.: 424Availability: ImmediateBuilding located in Leudelange. Functional areas, fully wired, easily divisible. Services and amenities are very good and make it a great place to work.

ref.: 207463

ref.: 288982

To letType: OfficeArea: 2549 sqmDiv.: 233 sqmAvailability: ImmediateBright and functional office space, divisible from 250 sqm, in an attractively converted industrial building of modern architecture.

ref.: 205166

AttractiveRent

p.5


NEW

Last floor

available

Type: OfficeArea: 1258 sqmDiv.: 629 sqmAvailability: ImmediateIn the Cloche d’Or area, we offer to let some office spaces organised over 2 floors, with good natural light, ideally located and close to public transport and Park & Ride parking.

Let by REALCORP

Current Offers



To letType: OfficeArea: 531 sqmDiv.: 199 sqmAvailability: ImmediateLuxury building with high-quality services in the imme-diate vicinity of Findel airport and its facilities. The office spaces are conveniently arranged, perfectly sound-proofed, and fully furnished.

ref.: 208700

To letType: OfficeArea: 916 sqmDiv.: Contact usAvailability: ImmediateNear to Auchan mall, this recent building has easy-to-fit and well-cooled spaces. Excellent parking ratio

ref.: 279979

Airp

ort /

Kirc

hber

g

To let Type: OfficeArea: 489 sqmDiv.: N/AAvailability: ImmediateModern building in the heart of the Kirchberg business district, near public transport and shops. Office spaces are of good quality and offer standard services.

ref.: 208265

To let Type: OfficeArea: 461 sqmDiv.: 83 sqmAvailability: ImmediateBright offices, well-finished and partitioned, in a building in a good location on the Kirchberg plateau.

ref.: 217233

To let Type: OfficeArea: 851 sqmDiv.: 62 sqmAvailability: ImmediateBrand new high standard building close to Airport and its amenities. The lettable areas are full of natural light and can be easily partitioned.

ref.: 217333

To let Type: OfficeArea: 2966 sqmDiv.: 707 sqmAvailability: ImmediateAt the heart of the tertiary area of the Findel Airport zone, a new and high standard building offers to rent office floors fully equipped for your needs.

ref.: 206239

p.6

NEW

Last Floor


To let

Bertr

ange

/Stra

ssen

/ Ca

pelle

n / W

indh

ofCurrent Offers

ref.: 292283



To letType: OfficeArea: 5863 sqmDiv.: 172 sqmAvailability: Q1 2012SolarWind building is focused on ecology and is the first triple-certified project in the world!It spreads over 10,000m² and offers wide and luminous offices.

ref.: 207027

To let Type: OfficeArea: 2637 sqmDiv.: 400 sqmAvailability: ImmediateIdeal working environment located on Route d’Arlon. This HQE building ensures relatively low cost of common expenses.

ref.: 204944

To let Type: OfficeArea: 505 sqmDiv.: N/AAvailability: ImmediateAt the heart of the ZA Bour-micht in Bertrange, we offer for rent offices fully wired and cooled with numerous parking spaces.

ref.: 207512

To let Type: OfficeArea: 18876 sqmDiv.: 292 sqmAvailability: ImmediateIn the Bourmicht area, these 3 office buildings are designed to high standards with good modu-lation, great parking ratio and many useful services for its tenants (creche, restaurants…)

ref.: 279649/ 279623/ 278967

To let Type: OfficeArea: 335 sqmDiv.: 211 sqmAvailability: ImmediateBuilding located a few meters away from motorways. The prem-ises offer a kitchenette, archives, and parking, at a very attractive rent.

ref.: 301227

p.7

Type: OfficeArea: 868 sqmDiv.: 265 sqmAvailability: Immediate2 floors of offices ideally fitted out and partitioned. The spaces are full of natural light and air-conditioned. Archive and parking upon request.

Last Floors

Available

NEW


AttractiveRent

Current Offers



p.8

To let To let

Perip

hery

ref.: 221809 ref.: 297841

To letType: Office Area: 1014 sqmDiv.: 411 sqmAvailability: ImmediateComfortable and secure building ideally located in a green environment close to Kirchberg and Airport, eas-ily accessible by public transport. Ernst & Young and Cetrel have chosen this place for their offices.

ref.: 278100

To let Type: OfficeArea: 245 sqmDiv.: N/AAvailability: ImmediateIdeally located between CBD and the Airport, this build-ing of recent construction presents well-arranged office space which is easily divisible. Archives and parking available.

ref.: 205218

Type: OfficeArea: 1809 sqmDiv.: 237 sqmAvailability: ImmediateThe recently completed building is located close to the A3 motorway to France. The premises are very bright and well-soundproofed and spread over 7 floors. Gen-erous parking allowance.

Type: OfficeArea: 473 sqmDiv.: 157 sqmAvailability: ImmediateCentral location for this office building ideally fitted out. Offices may be either open space or partitioned. The Hotel de Ville parking and the Esch sur Alzette train station are close to the building.


Hamm

Livange

Esch

Munsbach

To let

Reta

ilCurrent Offers

ref.: 203216



To letType: RetailArea: 1000 sqmDiv.: 500 sqmAvailability: Contact us2 brand new restaurant areas remaining in this building located in front of Luxembourg station, to be delivered by the end of the year.

ref.: 204107

To let Type: RetailArea: 663 sqmDiv.: 212 sqmAvailability: ImmediateSeveral commercial areas in the ground floor of a building ideally located on the Boulevard de la Foire, some with wide window displays.

ref.: 200981

To let Type: RetailArea: 363 sqmDiv.: 146 sqmAvailability: ImmediateRetail located in a recently refurbished building in the historical area of Luxembourg, in a pedestrian zone. Wide window display.

ref.: 298959

To let Type: RetailArea: 130 sqmDiv.: N/AAvailability: ImmediateRetail with 11m of window display. The space is in a totally refurbished building close to the Station.

ref.: 298343

To let Type: RetailArea: 1631sqmDiv.: 130 sqmAvailability: ImmediateWide commercial area to be reno-vated, close to public transport. 2 entrances, stock in the basement accessible via elevator.

ref.: 296924

p.9

Type: RetailArea: 525 sqmDiv.: N/AAvailability: Contact usTotally refurbished Period Property, offering a great view of the Place Guillaume. The spaces are majestic, full of natural light, with a great ceiling height. Rare opportunity!


Unique

Opportunity

Restaurants

Current Offers



p.10

To let To let

War

ehou

se

ref.: 294037 ref.: 287704

Type: Warehouse Area: 900 sqmDiv.: N/AAvailability: ImmediateIndependent new building located in the industrial zone in Grevenmacher. The premises are ideally arranged for administrative and/or industrial (showroom?) use. Numerous parking spots in front of the building

ref.: 299195

To let Type: WarehouseArea: 3127 sqmDiv.: N/AAvailability: ImmediateIn Mensdorf industrial zone, warehouse fully adjustable and available at a very attractive rent.

ref.: 206988

Type: WarehouseArea: 3700 sqmDiv.: N/AAvailability: ImmediateWithin the Industrial area of Gasperich, an expanding zone, used warehouse and office spaces requiring minimal refurbishment.

Type: Warehouse + OfficesArea: 2206 sqmDiv.: 45 sqmAvailability: Contact usWithin the industrial zone of Livange, close to the A3 motorway, several used office and warehouse spaces available,requiring minimal refurbishment. Numerous external parking spaces.


Mensdorf

Gasperich

Livange

Grevenmacher

Let by REALCORP

• After a slight hiccup from November 2011 to February 2012, then stagnation recorded in Q1 2012, the market indicators reveal a fall in GDP for the 2nd quarter in the Eurozone (a decline of 0.2% to 0.3%).

• The instability of the Eurozone, mainly due to differences of opinion on political solutions to the crisis, is likely to fuel the loss of business confidence.

• The economic forecast for Luxembourg announces a year of weak growth in 2012 (around 1%) and a sluggish recovery in 2013 (around 2%). However, in light of the current economic downturn, it is likely that these forecasts will be revised downwards in the coming months.

• The unemployment rate in Luxembourg has meanwhile reached 6% in May 2012, against 5.56% for 2011 (an 8% increase).

• Q2 2012 is therefore suffering a decline in GDP growth and rising unemployment, confirming the STATEC scenario announced earlier this year. The real estate market could suffer short and medium term fallout from this. Even though take-up improved early in 2012, we should expect a slowdown or even a delay of projects, until the macroeconomic situation offers more visibility.

Key Figures



ECONOMIC CONTEXT Q2

p.11


Source : STATECEurozone : GDP and PMI

Qu

art

erly

va

riatio

n %

Qu

art

erly

va

riatio

n in

po

ints

Eurozone GDP (percentage)Eurozone Composite PMI (points)

Key Figures



p.12


DEMAND How about take up Q2 towards last years?

0

20000

40000

60000

80000

100000

120000

140000

160000

180000

200000

SQM

2011

2010

2012

LIVANGELIMPERTSBERG

LEUDELANGE

OTHER SANDWEILER

HOWALD

AIRPORT

STATION

CAPELLEN

CBD

KIRCHBERG

ESCH

WINDHOF

TRS

SRV

GOV

OTHERS

IT&TELECOM

BFI

• The Q2 take-up comprised approximately 50,850sqm in 64 transactions, with an average of 794sqm per transaction—quite high, but affected by six big transactions of more than 3,000sqm, including:

• Société Générale Bank and Trust: 9,126sqm in Central Plaza building (Station area) • Université de Luxembourg: 8,627sqm in Richard Meier building (Kirchberg area)

• This quarter’s transactions were largely by Banking and Financial companies (57%) which represent more than half of the total take-up, followed by Government and other administration (17%), Services for companies and industries (13%), and IT & Telecom (6%).

• The most dynamic sectors for Q2 2012 were Kirchberg, Airport and Station, which registered a big progression due to several major transactions of more than 3,000sqm each. The Central Business District has been quite stable and is still in top position with the most transactions, among which was one of more than 4.000sqm.

The take-up of space in Q2 2012 was similar to that in Q2 2011.

Key Figures



p.13


SUPPLY

0%

2%

4%

6%

8%

10%

12%

14%

1 2 3 4 5 6 7 8 9 10 11 12 13

• 4 new deliveries are almost fully let:

• ADEM new headquarters (ESCH) —9100sqm fully let

• Stargate (CBD) —6600sqm: 368sqm still available

• Central Plaza (STATION) —13,000sqm: 4800sqm still available

• Solarwind (WINDHOF)—10,000sqm: 5700sqm still available

• There are two possible reasons for this stability. Firstly, good take-up (i.e. the large areas transacted)

compensated for deliveries of new office space. Secondly, the available stock increased slightly as well, due

to a few companies having left their premises and/or closed. This rise was offset by companies which extended

their office space, such as:

- Société Générale Bank & Trust—9126sqm

- Franklin Templeton—2576sqm

- Orangefield—296sqm more in the same building

12

16

20

24

28

32

36

40

44

CONTERN

HAMM

HOWALD

BERTRANGE

CAPELLEN

GARE

MUNSBACH

LEUDELANGE

STRASSEN

GASPERICH

AEROPORT

LIMPERT CB

D

KIRCHBERG

• After rising over the past few years, rents seem to have stabilized since the end of 2011. Prime rent remains at 40€/sqm in the CBD.

• Landlords are still willing to consent to some incentives most of the time, for example, by granting rent-free periods depending on the duration of the lease, or by participating in the fit-out costs, leading to a decrease in economic rent.

• In Q2, the vacancy rate reached 7.16%, representing

approximately 237,000sqm of available space (+0.27

points more than Q1 2012, i.e. the rate remained fairly

stable). In the CBD, this rate only reached 2.5%, while

in Kirchberg it reached 2.2%. These figures reflect that

most available stock is located at the periphery of the

City, e.g. Airport: 14.7%, Bertrange: 28%.

Glossary



p.14


Availability Total office space on the rental or selling markets

Economic rent Rent calculated after deduction of all Incentives

Headline rent Rent recorded in the lease contract

Incentives Inducements to future tenants, such as a contribution to fit-out works or a rent-free period

New delivery New buildings that were delivered during the quarter, whether already occupied or still available

Pipeline Total of constructions expected to be delivered in the near future

Presentation rent Landlord’s requested rent which is announced to the Lessee

Prime rent Highest value rent recorded for a high quality office unit in the best location during a specified period (after abnormal statistics have been eliminated)

Take-up Total office stock known to have been let, pre-let, sold or pre-sold

Total office stock Sum of existing office space (buildings), either occupied or free

Vacancy rate Total vacant space offered for letting divided by total stock of space, expressed as a percentage

Feature



AVAILABLE

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Elise in LeudelangeAn ideal workspace, Elise reveals an architectural and environmental concept t remarkable on several levels.

In their project design, Linster Stupar Architects aimed for harmony. This is apparent in the layout of the work area which is divisible from 230 m², as well as in the exterior landscaping.

An atrium and garden terraces offer building occupants attractive areas for relaxing and


RealCorp offers you harmony and light in this attractive office building.

Elise has been awarded a Valideo certificate. This green standard is a seal of certification for sustainable construction that assesses how a construction project may include respect for the environment, economy and society. Specifically adapted to the standards and regulations in force in the Grand Duchy of Luxembourg, the benchmark covers four themes: Construction, Management, Comfort and Social Value. It also takes into account the different stages of the life of a structure: Construction, Operation, Renovation, and Reassignment. VALIDEO is a guarantee of good environmental behaviour and adds value to any project certified.

The LocationAddress: ZI, Am Bann, L-3372 Leudelange

Ideal for car access, Elise is only about 500m from the motorways, and 20km from Findel Airport.

There is also excellent provision for cyclists, with bicycle parking & changing rooms.

refocusing during the working day. The high quality nat-ural materials of the exterior fittings give Elise a particu-larly “green” aspect, including:

• Driveway with eco-slabs or natural grass paving systems • Wire mesh gabions with stacked stone • Natural stone and concrete in the entry area • Eco-pavers, lawn, benches and planter boxes • Decorative lighting columns

Feature

p.13


Floor Type Sqm

3

3

2

2

Total

Ground

-1

-1

-2

-2

Offices

Offices

Offices

Offices

Offices

Parking

Parking

Archives

Parking

Archives

700

700

234.54

951.08

2585.64

55 bays

52 bays

212.09

59 bays

296.8

Remaining available space as at June 2012:

Technical Specifications

Tehdi-Edouard Babigeon Head of letting & sales

[email protected]: +352 26 27 29 22 (Direct)

Jennifer VenneAgency & research

[email protected] Tel: +352 26 27 29 34 (Direct)

Have a project, need advice or simply wish to visit ?

Contact us

The building benefits from high quality services, including: • Building services control system • Cooling in ceilings • Raised floors in wood or metal • Horizontal acoustic barriers between offices and corridors • ArGeTon® façades • Automatic exterior blinds with adjustable slats • Elevators • Rainwater recovery • Thermal insulation • Covered and open-air terraces • Central atrium • Reserved visitor parking • Bicycle parking • Changing rooms



p.16

Aurélie Vanaudenhoven Account manager

[email protected] Tel: +352 26 27 29 24 (Direct)

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