Last May, when the first lockdown was lifted, we had already made an initial assessment of the full impact that the coronavirus crisis would have on the property market. We set out to define the opportunities that could emerge for the investor, and the risks that could, at the same time, arise from this crisis.
Almost eight months later, it is clear that the virus is still with us, and that some of the effects of the crisis are not yet being felt.
However, as far as the property investment market is concerned, a first assessment can already be made… within reason.

Despite a certain degree of absolute resilience that few people could have hoped for, it is still recognised by banking experts that the property market is not going to escape the devastating effects of the now-famous “coronavirus” or “covid-19”. According to analysts, the growth of the market is going to be compressed over the coming years and this, with regard to a simple variable whose deterioration cannot be avoided: that of household income! In fact, and still according to the latter, if the property market currently seems to be impervious to external disturbances, it is due primarily to the multiple government subsidies that maintain, as much as possible, the said household income levels.
Property professionals, however, consider that no setback is to be expected. “Quite the contrary”, they chorus!
While it is true that the decline envisaged will be relatively marginal and time-limited, considering property as an asset class that is impervious to external contractions means making savings in some of its sectors which are unlikely to emerge unscathed from the current crisis.
The Twilight of the Idols.
Historically present on the market or recently emerging, some highly coveted sectors of the property market are likely to see their ratings downgraded.

The Retail Sector:
The simple case of retail (commercial property) can only serve to make us aware of this sad reality. The retail sector, which is highly regarded by investors, has been in the ascendancy for the returns it can provide, combined with almost zero management and constant demand.
However, in recent years, the market has been running out of steam. Due to the waves of attacks, the different mobility policies put in place and the craze for “e-commerce”, this sector has been forced to reinvent itself. The coronavirus crisis will only accelerate exponentially the process that has already begun. It is even very likely that for certain uses of this sector, including retail, we are facing a point of no return.
The Office Sector:
And what about the office market? Let us take as an example some companies with several thousand employees, which have been able to convert to teleworking quickly and efficiently while showing practically no deterioration in their turnover. We can be forgiven for wondering whether the millions of square metres dedicated to office activities are still as indispensable as before. Knowing, moreover, that property represents a significant fixed cost for companies, it is highly likely that the coronavirus crisis will cause the cards to be reshuffled.
Nevertheless, and unlike the retail sector, office property has the advantage that the asset or underlying asset has a higher conversion potential and may be eligible for a change of use. Indeed, refurbishing an office building for other purposes seems more feasible than repurposing a commercial property.
Sectors with the wind in their sails:
Although some specific sectors are likely to suffer the full brunt of the current crisis, other sectors may well see their popularity levels rise.

Logistics or semi-industrial :
This is really the corollary of the retail sector: “When one doesn’t go, the other does!” In fact, the semi-industrial sector has been buoyant for several years now, thanks of course to the rise in power of individual multinationals such as Amazon, for whom the need for storage is unquestionable.
“Thanks” to the covid crisis, the demand for storage space and platforms is on the rise. This sector has, moreover, been able to benefit from a double positive effect on its growth. On the one hand, the accelerating penetration of e-commerce into our consumption habits. On the other hand, the more or less certain tendency to want to move towards de-globalisation, which results in the suppression of the various supply chains, which pushes companies to stock more, and which, in the end, is positive for the sector in question.
The residential sector:
History has told us repeatedly that, in the wake of an economic crisis, there has always followed a long period of slow and hesitant growth, where a retreat into so-called “precautionary” savings was intensified.
In the light of this, we could be forgiven for thinking that the conservative attitude of tomorrow’s investors will encourage them to launch massively into property, which is, moreover, in its simplest expression, i.e. residential property!
Indeed, thanks to a very well-balanced “risk/return” ratio, and the stability of this market, which does not seem to be experiencing the crisis, or thanks to a constant growth in selling prices supported by investors but also by occupying buyers, residential property is very clearly asserting itself as the sector that is currently the most-watched.
In addition to the elements that may or may not result from the current crisis and that argue in its favour (stock market volatility, excessively low borrowing rates, yield but also possible future capital gains, etc.), this sector can also boast of a relatively recent phenomenon: the increase in the number of prospective tenants. In fact, for several years now, we have noticed that young Belgians are no longer desperate to own bricks and mortar and that they prefer to preserve their freedom and remain tenants for a few more years.
This bodes well for anyone wishing to invest in residential property, since considering property as an investment product is not feasible without keeping in mind the possibility of using wisely the fruits of the capital invested. Any market in which the ability to nurture yield correctly is limited is clearly not a sector to be exploited.
From this point of view, and in addition to the possibilities that exist in terms of added value, investors will always be attentive to the fact that their property can adequately meet the broadest possible demand on the rental market, which, therefore, seems to be more than conceivable from now on.

Conclusion :
Current events show us that property is a transversal sector that is clearly influenced by elements outside its own market, and therefore must adapt continually to constantly changing societal and economic variables.
While certain specific segments may never again return to their previous form, logistics and especially residential property still have a bright future ahead of them. The hope is, however, that their respective markets do not become totally unbalanced between a limited supply in the face of a constant and growing demand.