Amsterdam Office Market Profile - Q4 2013

12 Month
Summary Statistics Q4 13 Q-o-Q Y-o-Y Outlook
Take-up (000s sqm) 97 118.5 % 12.5 %
Vacancy Rate (%) 14.9 80 bps -10 bps
Prime Rent (psm) 335 0 % 0 %
12 Month
Q4 13 Q-o-Q Y-o-Y Outlook
Capital Value (psm) 6091 1.8 % 1.8 %
Prime Yield % 5.50 -10 bps -10 bps
Change*
Change*
* % Change for Prime Rents and Capital Values calculated using local currency

Market Overview
Take-up in the Amsterdam office market more than doubled over
the previous quarter, reaching a total of 97,440 sq m. This was
more than twice the volume recorded in Q3, however, the annual
volume for 2013 was almost on a par, albeit slightly below the
previous years level. Optimising cost & space and flight to
quality remained high on the corporate agenda and were the
drivers of activity in the market. The reduction in office space per
employee (from 25 sq m/person to 12 15 sq m/person) as an
outcome of changing work place strategies continued to reduce
corporate space requirement and is likely to impact take-up
volumes in the near term. Larger tenants are now upgrading to
intelligent buildings that enable innovative workplace solutions,
with growing demand from businesses to increase productivity
and retain talent. Demand is expected to build-up by the end of
2014, as economic conditions improve. The overall vacancy rate
increased 80 bps q-o-q to 14.9%, despite tight lending conditions
and the municipalitys restrictive new-build policy, as secondary
space is being released back on the market due to corporates
moving into new accommodation or due to space consolidation
strategies. On the contrary, the availability of prime space
particularly in the sought-after Zuidas, continued to erode as
most of the activity was concentrated here. There were no office
completions in Q4. The development pipeline, largely pre-let,
totals 84,995 sq m, scheduled to complete in 2014.

Prime rents remained flat at 335 / sq m pa, whilst rents in
secondary office locations stood at 191 /sq m pa and remain
supported by incentives. Incentives in the prime submarket
Zuidas are expected to decrease and rents here could move
upwards in the short to medium term. Incentives typically include
9-15 months rent free on a 5+5 year lease contract in prime
locations and 10-22 months rent free for the same lease length
across the market as a whole. The investment sentiment
improved towards the end of the year. Commercial property
worth 1.86 billion changed hands in 2013 of which 910 million
was invested in offices. Prime yields saw a 10 bps compression
and reached at 5.50%.
Figure 1: Take-up
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000s sqm
TakeUp 10yr Average

Figure 2: Supply and Vacancy Rates
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000s sqm
VacancyTotal VacancyRate
Vacancy Rate %

Figure 3: Prime Rents and Rental Growth
0
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Rental Growth PrimeRent
Prime Rent (psmpa) Annual Rental Growth*

Figure 4: Prime Yields
4.50
5.00
5.50
6.00
6.50
Q
4

9
8
Q
4

9
9
Q
4

0
0
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1
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1
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1
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1
3
PrimeYield 10Yr Ave 20Yr Ave
Prime Yield (%)

Source all Charts: Jones Lang LaSalle















Amsterdam Office Market Profile Q4 2013
Pulsereports from Jones Lang LaSalle are frequent updates on real estate market dynamics.
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Jones Lang LaSalle Contacts

Martijn Smits
Head of Office Agency
Amsterdam
+31 20 540 7898
martijn.smits@eu.jll.com
Dr van Leeuwen
Head of Capital Markets
Amsterdam
+31 20 540 7912
dre.van-leeuwen@eu.jll.com
Michael Hesp
Head of Research
Amsterdam
+31 20 540 7851
michael.hesp@eu.jll.com
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