At Thomas & Piron, the people in charge may change, but the message remains the same in times of crisis. Nor free and frank speech. The managing director of Thomas & Piron Luxembourg, 
“The worst thing is a wait-and-see attitude. Political inaction is paralysing the [property] market.” Günther Beining’s observation sums up the prevailing mood in parts of the Luxembourg property sector today. For the managing director of Thomas & Piron Luxembourg, the current market standstill is not solely the result of rising interest rates or falling purchasing power in the property market.
“It is also the result of widespread anticipation surrounding policy announcements whose tangible effects are slow to materialise,” he insists. Alongside Olivier Beguin, the first CEO in the group’s history not to come from the founding family, the executive nevertheless holds a firm conviction: despite the crisis, Luxembourg remains one of the most promising markets in Europe.
A turning point in the form of an unmissable adaptation
The arrival of Olivier Beguin marks a turning point in the history of Thomas & Piron. For the first time since its foundation, the group is led by a CEO from outside the founding family. A development which, according to Günther Beining, does not represent a break with tradition, but a necessary adaptation. “Olivier has fully grasped the family’s DNA. He shares the same values, whilst bringing a vision suited to an environment that has changed profoundly.”
This commitment to adaptability has led to a group-wide strategic review aimed at strengthening the group’s ability to navigate a market that has become more unpredictable and volatile than ever before.
The bankruptcies of certain companies have created a climate of mistrust that is affecting the entire market.
A crisis of confidence that goes beyond mere fundamentals
For both executives, the current crisis is, above all, a crisis of confidence. The difficulties faced in recent years by several players in the sector have had a profound impact on buyers. “This is not a problem specific to Thomas & Piron. The bankruptcies of certain developers have created a climate of mistrust that is affecting the entire market,” says Günther Beining.
In light of this situation, the group is highlighting its financial strength. Thomas & Piron states that it has continued with certain development projects without pre-sales or prior recourse to bank financing – a capability that few market players can currently claim.
Why Luxembourg remains strategically important
Despite the slowdown in transactions, Thomas & Piron is not rethinking its strategy in Luxembourg. The group employs nearly 400 people in the Grand Duchy and continues to develop new projects there.
For Günther Beining, the fundamentals remain unchanged. “Luxembourg remains one of the few European countries to show sustained population growth. Every year, nearly 10,000 people move to the country. They will need somewhere to live.”
This observation is fuelling the group’s optimism. Whilst housing starts have fallen sharply over the past two years, underlying demand remains intact. The housing shortage has not gone away; in fact, it is getting worse.
The country is waiting, but the government remains silent
It is precisely for this reason that industry leaders are particularly critical of the current climate. In their view, the announcement of future government measures designed to support the housing market has had an unexpected effect, prompting some buyers to put their decisions on hold whilst they await further support or new regulations.
“Announcing something, then falling into a kind of lethargy where nothing happens, is the worst thing. Today, the whole country is waiting,” says Günther Beining. Olivier Beguin shares this view: “The mistake was announcing measures without a sufficiently clear timetable. That has paralysed the market. Buyers are waiting to know exactly where they stand before repositioning themselves.”
In the view of both leaders, even imperfect measures would have had the merit of providing clarity and allowing the market to regain a degree of fluidity.
Building differently to adapt to a new reality
In response to the decline in people’s ability to buy property, Thomas & Piron is already working on new housing models. In particular, the group is developing concepts inspired by the German market: minimalist homes, modular housing and adaptable homes that can be gradually extended to meet the occupants’ needs.
The aim is simple: to make home ownership more affordable without compromising on quality standards. “Households can no longer afford the same size of property as they could ten or 15 years ago. This reality must be taken into account in the projects we are developing,” emphasises Günther Beining.
One of the options being considered is the temporary installation of modular housing on sites awaiting final development. This solution would make it possible to rapidly increase the available supply whilst making use of plots of land that have sometimes been left unused for several years.
A shift that is as much cultural as it is economic
For Olivier Beguin, the current crisis highlights a more profound shift in attitudes towards housing. “The market will recover once decisions have been made. But we will also have to accept that housing models are changing.”
Some people continue to reject what they call ‘rabbit hutches’, but 300-square-metre homes are no longer economically viable…
A view shared by Günther Beining: “Some people continue to reject what they call ‘rabbit hutches’, but 300-square-metre homes no longer reflect the economic realities of a large section of the population.” Beyond financial or regulatory issues, therefore, a shift in attitudes is also taking shape.
Prepare for the recovery rather than wait for it
Despite a market that remains sluggish, Thomas & Piron is committed to maintaining its investments and continuing to launch new projects in Luxembourg. “We are continuing to build. We are keeping a close eye on opportunities and are ready to support the recovery when it materialises,” concludes Olivier Beguin.
In a country where the housing shortage remains one of the main economic and social challenges, the group is banking on the current crisis being, above all, a temporary blip. Provided, however, that confidence returns and that the long-awaited decisions are not further delayed.
