presentation bc market analyses bobca ver 1
DESCRIPTION
Draft presentation of Business Center Market Analysis in BelgiumTRANSCRIPT
De power of professional financial management
fin POWER
MARKET ANALYSIS 2010
Presentation BOBCA, 5/10/2011
DRAFT VERSION – FOR DISCUSSION PURPOSES ONLY
BUSINESS CENTER MARKET IN BELGIUM
I. Business centers in Belgium I. Number of business centersII. 3 types of shareholdersIII. Location of business centers
II. Financials of business center in BelgiumI. TurnoverII. Added valueIII. Financing structureIV. Personal V. Operational profitabilityVI. Net profitability
Annex : • List of inventarized business centers
INTRODUCTION
Business centers in Belgium : See list in annex Research by a maximum of means
Growing market if you know new centers, please let me now.
What is a business center ? Uses this as name of his business Including ‘bedrijvencentra’, excluding ‘innovation centers’/incubation centers !! Serviced offices = full time reception services
Used figures : Published financial data Added by questionnaire august 2011
INTRODUCTION“Definitions and limitations”
Total appr. 120 business centers in Belgium :
29 ‘BC’s’, bedrijvencentra
9 Regus
5 NCI/Multiburo
7 groups with 2-4 centers
56 ‘individual business center owners
First estimate of the market (appr. 90 % reliability)
3500 individual offices, 10.000 workstations ?
200-250 meeting rooms
Appr. 3 - 5000 virtual offices
Listing is not ‘clear-cut’
No innovation/incubation-centers
No ‘co-working-spaces
Not included : incubation/innovation centres, > 30 in
Belgium – mainly in the Walloon region.
We have in Belgium appr. 120 business centers, of which appr. 50 % are individual centers.
I. BUSINESS CENTERS IN BELGIUM1.1. Inventory
75 % of the business centers are situatied in
Brussels, Antwerp en Gent
95 % of the internationally owned
85 % of the privatly owned
30 % of the semi-public-initiatives
The penetration in other cities is very low, mainly
private and semi-public initiatives
3/4th of all business centers are located in the three main cities of our country.
I. BUSINESS CENTERS IN BELGIUM1.1 Business centers pro city
CityInternational
ownershipPrivate
ownership(Semi)-public
ownership Total
Brussel 12 33 3 48
Antwerpen 5 8 5 18
Gent 1 6 3 10
Charleroi 3 3
Mechelen 1 1 1 3
Hasselt 1 2 3
Sint-Niklaas 1 1 2
Namen 2 2
Aalst 1 1 2
Kortrijk 1 1 2
Luik 2 2 Other cities 2 3 22 27Eind-totaal 21 62 39 122
Most business centers in Belgium are
situated at the suburban area of the cities
Only 1 on 3 business centers is located in the
centre of the cities
Appr. 20 business centers are located in
industrial site
Airway and motorways only attract a minority
of business centers
Nearly 50 % of the business centers are located at the suburban office-area’s of the cities.
I. BUSINESS CENTERS IN BELGIUM1.3. Business center pro location
The market growth is very low for a ‘new en dynamic’ market
II. FINANCIAL DATA OF BUSINESS CENTER MARKET2.1. Turnover estimation
• Market appr. 50 Mio €– International BC 45 % of market– Private national BC 35 %– Public BC ca. 20 %
• Growth rhythm – YAGR ca. 3.5 % =/= inflation !– Private BC > 6 % and stable
growth rhythm, higher then inflation
– Semi-public BC, 2 %, lower then inflation
– International BC, 3.5 % but concentrated in 2006-2008.
The market growth was only substanial in 2006-2008, 2009 and 2010 were years without market growth !
II. FINANCIAL DATA OF BUSINESS CENTER MARKET2.1. Added value
• More correct then turnover (estimated)
• Figures of 2010 representative, except for ‘international’ (Regus 2010 still not
available)• Growth rhythm remains
low– 2001-2010 : 3-4 %– 2006 – 2008 : > 15 %– 2009/2010 : no growth !
• International players have relatively lower added value (less ‘own’ building, see further)
The three different market types have different ‘business models’
II. FINANCIAL DATA OF BUSINESS CENTER MARKET2.3. Fixed assets (Material fixed assets)
• Semi public BC nearly always own their property
• Private BC are the main investors in property from 2006-07 on.
• International BC do not own the buildings they operate in.
The financing structure of the different players in the market is very different.
II. FINANCIAL DATA OF BUSINESS CENTER MARKET2.4. Equity
• The market ‘owns’ more equity then it has turnover …
– The ‘semi-public’ market has four times more equity then it makes turnover
– The private market realizes 1.5 € turnover for every € equity
– The international players realize the highest turnover with a maximum of leverage
The financing structure of the different players in the market is very different.
II. FINANCIAL DATA OF BUSINESS CENTER MARKET2.5. Financial debt
• The three ‘business segments’ have a different financing structure :
– The ‘semi-public’ market mainly (80 %) finances itself with equity
– The private market has a gearing of appr. 200 % (2 € loan financing for 1 € equity)
• This indicates that appr. 70-80 % of the investments are financed
– The international players limit their financing and equity by renting their buildings.
The semi-public initiatives have relatively less personal then the private and international business centers
II. FINANCIAL DATA OF BUSINESS CENTER MARKET2.6. Personel
• The number of personal active in this market is appr. 225 people– Excluding the appr. 50 – 100
‘fee-earning managers/owners’
• The number of personnel is growing at the same rhythm as the turnover does (3.5 %/year)
• International owners have relatively more personnel then the semi-public owners
1 out of 2 business centers do not make an operational profit !
II. FINANCIAL DATA OF BUSINESS CENTER MARKET2.6. Operational profit
• The different segments of the market present totally different operational profitability :– International BC are (very)
profitable the last years– Private players have a declining
profitability the last years– The semi-public market do not
generate operational profits as a whole.
• 58 out of 122 business center lose money, this 50 % is relatively stable during the last 10 years.
40 – 45 % of the business centers have a negative net result.
II. FINANCIAL DATA OF BUSINESS CENTER MARKET2.6. Net profit after taxes
• The international BC do make profit after taxes
• The private BC are also making losses, due to the limited operational profitability and the substantial financial costs
• The semi-public business centers make net profit due to positive financial revenues and extra-ordinary income (sale of property).
Conclusions
• The business center market has not grown in 2009 and 2010– After double digit growth in 2007 and 2008
• The ‘business models’ of the different kind of shareholders differ substantially :– International players are profitable, without investing in fixed assets– Private investors are operationally profitable, and focus mainly on the long-
time value of the owned building– Semi-public owners are making losses but are very solvent and liquid, and
they can survive through financial and extra-ordinary income