THE NETHERLANDS

Office Market
Snapshot
First Quarter | 2017

Overview MARKET INDICATORS

The sentiment on the Dutch office market is healthy, as the Market Outlook
demand from occupiers and investors continues to remain high Prime Rents: Prime rents will increase further for core markets, as
for core locations within the Randstad area. Confidence further other locations will register a small increase as well.
grew due to the positive outcome of the elections, whereas the Prime Yields: Yields continue to remain sharp, as capital remains
effect from the Brexit is strengthening. Rental levels and yields widely available. Whereas emerging locations will
benefit from a limited availability.
remained fairly stable during the first quarter of 2017.
Supply: Will declines further on prime locations and continue
to remain stable at alternative locations.
Occupier focus Demand: Demand continue to remain high for prime locations,
The office take-up volume in the previous quarter concentrated however, well-accessible second tier locations will
around the four largest cities of the country, registering half of further grow in popularity.

the total volume within this area. During the first quarter of Prime Office rents – March 2017
2017 the Randstad area continued to remain popular amongst LOCATION € US$ GROWTH %
occupiers, vacancy rates dropped as supply decreased SQ.M SQ.FT 1YR 5YR
YR YR CAGR
nationwide. Occupier demand is high for well-accessible
Amsterdam (South Axis) 425 43.0 0.0 2.5
modern multifunctional office buildings, whereas the main
Amsterdam (Central) 375 37.9 0.0 1.4
drivers of the take-up volume remained Media and Technology
Amsterdam (South-East) 195 19.7 0.0 0.0
firms and serviced offices. Rental levels on prime locations
Rotterdam 225 22.8 0.0 3.4
slightly grew, whereas alternative locations with a high level of
amenities benefit from the limited supply on prime locations The Hague 210 21.2 0.0 0.0

and registered a small increase as well. Utrecht 200 20.2 2.6 0.5
Eindhoven 160 16.2 -3.0 -1.2

Investment focus Prime Office yields – March 2017

Investors’ appetite continued to remain high in the first quarter LOCATION CURRENT LAST LAST 10 YEAR
of 2017, although, the availability of prime investment products (FIGURES ARE GROSS, %) Q Q Y HIGH LOW
in dominant areas of the country is rather limited. Amsterdam (South Axis) 4.00 4.00 4.75 6.75 4.00

Nevertheless, the positive elections stimulated the investors’ Amsterdam (Central) 4.00 4.00 4.75 7.00 4.00

confidence as well as the interest rates which remained low. Amsterdam (South-East) 6.15 6.15 6.50 8.25 5.50
Due to a limited availability on prime locations in the country Rotterdam 5.50 5.50 5.50 7.00 5.50
investors’ focus shifts to core+ investments in the larger cities. The Hague 6.00 6.00 6.00 7.00 5.75
Yields compressed further compared to previous quarter, as Utrecht 5.75 5.75 6.00 7.25 5.75
the highest declines were registered in Amsterdam Central Eindhoven 6.75 6.75 7.00 7.75 6.25
and South Axis. With respect to the yield data provided, in light of the changing nature of the market and the costs implicit in
any transaction, such as financing, these are very much a guide only to indicate the approximate trend and
direction of prime initial yield levels and should not be used as a comparable for any particular property or
transaction without regard to the specifics of the property.

Outlook Recent performance

The positive outcome of the elections will further increase
Yield - Country Average Yield - Prime
occupier and investors’ confidence. Whereas the impact of the Rental Growth - Prime Rental Growth - Country Average
Brexit might bring employment opportunities due to the influx 9.00% 15.0%
of new businesses. This will have a positive effect on the office
Rental growth (y/y)

8.00%
10.0%
market, especially the Randstad area which will continue to be 7.00%
Yields

6.00% 5.0%
dominant. Capital remains widespread as interest rates are
5.00%
low, however, the prognosis of a slightly increase by the end of 0.0%
4.00%
the year can influence the investors’ appetite. 3.00% -5.0%
Mar-07 Mar-09 Mar-11 Mar-13 Mar-15 Mar-17

This report has been produced by Cushman & Wakefield LLP for use by those with an interest in commercial Frank van der Sluys MSc
property solely for information purposes. It is not intended to be a complete description of the markets or
Associate Director, Head of Research, The
developments to which it refers. The report uses information obtained from public sources which Cushman &
Wakefield LLP believe to be reliable, but we have not verified such information and cannot guarantee that it is Netherlands
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