More than 5,000 homes per year missing (Wort.lu)

The real estate sector knows no crisis. Renting an apartment cost 7.6 percent more in 2014 than the year before. As far as houses are concerned, rents increased by 2.9 percent.

A relaxation is not in sight. The demand stands at 15,000-18,000 homes per year, whereas only 5,000 to 7,000 apartments are made available each year on the real estate market of the Grand Duchy. The government should double its construction programmes for at least three years by relaxing the rules to hope to stem the soaring prices.

Existing properties continue to seduce the market with sales going up by 3% for apartments and 2% for houses but increasingly buyers are showing their interest into an estate that they will finish themselves to control every detail of their future investment.

As for the office space, 2014 was a special year for this specific business. The consulting giant firm PwC moved to the Crystal Park in the Ban de Gasperich whilst the BCEE bought the Arbed building on the Avenue de la Liberté from ArcelorMittal. The real estate specialist Jones Lang LaSalle (JLL) leased or sold a total of 201,000 square meters of office space, which is an increase of 38 percent year-on-2013.

This year the European Commission will sign leasing agreements for a total of 40,000 square meters to accommodate their employees waiting for completion of the Jean Monnet building which is due to follow in 2019. Many of them have their jobs already in the commercial area known as Cloche d’Or. Maybe the entire Commission will provisionally move there. Following its expansion, the European Investment Bank is currently looking for additional premises covering an area of about 30,000 square meters.

The highest rents for office space were recorded last year in Luxembourg City with € 42 per square meter. Shops and other commercial activities situated in the most sought-after shopping districts of the capital paid up to € 120 per square meter. On the other hand, storage units continue to lose ground as the neighbouring countries, be it Germany, France or Belgium, offer much more attractive and competitive prices per square meter.