Food, decorations and health are gradually taking the place of fashion chains on the Belgian high street and in shopping centres. Rents are falling, except for those outlets along main roads. And of course, the dividing line between physical shops and online sales is becoming even more blurred.
New supermarkets
A remarkable swing is happening in Belgian high streets: the number of rental transactions in the fashion and accessories sectors fell by 28 % and 30 % respectively last year, compared to a five-year average. On the other hand, there was an increased number of transactions in the supermarket, food, decoration and health and beauty sectors. In fact, the number of supermarket deals in 2019 was more than double the five-year average, mainly due to smaller concepts such as newcomer Delhaize Fresh Atelier.
The annual balance sheet of the Belgian retail real estate market, compiled by international real estate agent JLL, indicates that food retailers and catering chains can not pay the same rents as the major fashion brands. In addition, the margins achieved by retailers in their physical stores are shrinking, and there is also the cost of online retail. All these factors cause a decrease in the top rents for retail property in 2019: the prime rent for shopping streets such as Meir in Antwerp is now 1,850 euros per square metre per year, representing a decrease of 5 % on an annual basis. The top rent for shopping centres such as Wijnegem amounts to 1,350 euros, which is also a decrease of 5 %. It is only the rents for stores on major routes that remained stable at 175 euro, exhibiting an upward trend.
Hybrid stores
The most active retailers in the last twelve months were Chitir Chicken, KFC and O’Tacos in the food sector; Jumbo, Delhaize and Albert Heijn for supermarkets; Snipes, Only, Tape à l’Oeil and Brantano in the fashion sector; Medi-Market and Holland & Barrett in the health&beauty sector. Action, Jysk, Orange and Paul Marius also expanded significantly.
Physical stores remain important, according to JLL, but their role is changing as the dividing line between physical stores and online sales becomes ever more blurred. Shoppers can order products in the shops, or they can pick up packages that they have ordered online. Shops therefore have a hybrid function, acting as a point of sale, order point, delivery point and after-sales service, while also being part of the global marketing strategy. For retailers, data is becoming more important: by collecting and analysing information about both physical and online buying behaviour, they can set up more targeted marketing campaigns.
