Reports from L’Echo and De Tijd on Thursday reveal that negotiations between the European Commission and the federal government have been ongoing for several months concerning a property deal worth around €1bn. Government investment body, SFPI, reportedly aims to purchase 23 aged Brussels buildings. The European Commission intends to sell most of the buildings it owns, besides the Berlaymont building, which serves as its main headquarters, and represents a total 350,000 square metres of offices in the Léopold district. As it is a deal between a European institution and its host country of Belgium, the Commission is not required to arrange for a call for tenders, however the private sector is set to play a role in the project, with SFPI purchasing the Commission’s buildings before leasing them back in collaboration with real estate developers, in order to raise money toward the purchase price.
The federal government and the European Commission have been conducting exclusive negotiations for several months on a real estate transaction worth nearly 1 billion euros, write L’Echo and De Tijd in their Thursday edition. According to a source familiar with the matter, the SFPI, the federal government’s investment vehicle, wants to buy 23 old buildings in Brussels.
The European Commission wants to sell most of the buildings in its possession (with the exception of the Berlaymont building, which houses its main headquarters) representing a total area of 350,000 m² of offices located in the Léopold district. The largest building in the portfolio is the gigantic office complex at rue de la Loi, 130.
As this is an agreement between a European institution and its host country, Belgium, the European Commission is not required to organize a call for tenders. The private sector should, however, play a role in the project. Initially, the SFPI itself will buy the buildings of the Commission.
Then, it intends to allocate the portfolio in installments to renovate and redeploy it in collaboration with real estate developers. This would allow him to recover part of the purchase price.
The potential real estate transaction between the federal government and the European Commission would be one of the largest transactions in recent history, worth nearly 1 billion euros. The SFPI’s plan to buy 23 old buildings in Brussels and allocate the portfolio in installments to renovate and redeploy in collaboration with real estate developers is a smart move that would help recover part of the purchase price. It remains to be seen how this agreement between a European institution and its host country, Belgium, will play out, but it certainly has the potential to significantly impact the real estate market in the Léopold district. Stay tuned for more updates on this developing story.