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RANDSTAD OFFICE MARKET 2013 STATE of AFFAIRS Amsterdam Region

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RANDSTAD OFFICE MARKET 2013 STATE of AFFAIRS Amsterdam Region RANDSTAD OFFICE MARKET 2013 STATE OF AFFAIRS amsterdam REGION So far the Amsterdam conurbation has managed to distance concerned are Sloterdijk-Teleport, ‘Westelijke Tuinsteden’ itself quite well from the negative sentiment in the office and North. Especially Sloterdijk-Teleport is suffering market. Based on the number of transactions and the corre- heavily. Not only did demand for office drop significantly, the sponding take-up volumes, for several years now demand for area is also suffering from high vacancy levels. Office office space has been at a relatively high level. In the first six vacancy is a problem anyhow; a problem the Amsterdam months of 2013, the demand side again developed reason- office market has been dealing with for quite some time now. ably favourably. Taking a closer look at the office take-up At this moment approximately 17% of 6 million m² office figures, however, one cannot but ascertain that from a stocks are offered for rent or sale. This is but a fraction less spatial point of view, demand is not divided equally. For it is than the percentage of office space offered in late 2012. the city of Amsterdam in the first place where most dynamics can be sensed. In the adjacent municipalities of Supply is still high because in many lease transactions there Amstelveen and Diemen, demand for office space simply has been a shift and lessees have been taking up fewer would not get off the ground. square metres than those abandoned elsewhere. Companies and organisations that decide to extend their contracts, are Unmistakable differences are also noticeable in the Dutch also settling for less office space. One interesting example in capital itself. For instance, figures confirm that in recent this context is Reed Elsevier in Sloterdijk-Teleport. This years demand mainly involved Southeast, the city centre publishing company has decided to stay, but it will give up and South Axis. As for Southeast, lessees are mainly inter- half the floor area it has been using so far. ested in offices around the Amsterdam ArenA, which should not come quite as a surprise. Bearing in mind the proximity Even though 120,000 m² of office space were withdrawn of the train station and numerous facilities among other from stock last year in the city of Amsterdam, a solution for things, it is an attractive location for many companies. the high vacancy level seems miles away. In any event, due Whether this part of Southeast will manage to hold on to the to the ample supply of vacant offices, with the exception of a take-up figures of previous years despite its liveliness and few projects the construction of new offices almost came to a convenient accessibility, is a rather difficult question to standstill. Especially companies that require larger office answer. It is however clear that in the first six months of this space might have a problem finding enough floor area in the year, less office space was taken up compared to the same future. This, however, is less relevant in the short term as period in 2012. The same applies more or less to develop- the number of large-scale tenants looking for premises has ments in the popular South Axis business district. Again, slightly dropped. The ample availability of offices also inter- demand for office space in this area was comparatively fered with rents. Investors have been offering a lot (incen- rather low in the first six months of the year. Here, it should tives) and also, rents are clearly becoming more realistic. be noted that in 2012 the lease transactions with AkzoNobel This basically means that lower rental levels are realised and Stibbe ensured a high take-up level. almost everywhere. Office areas in the city of Amsterdam which have been sailing against the wind as far as the take-up figures is NVM BUsiNess RANDSTAD OFFICE MARKET 2013 TRENDS IN OFFICE take-UP PER DISTRICT 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 H1 m2 Amsterdam Centre 30,000 59,000 93,500 71,000 39,500 26,000 32,500 46,500 53,500 36,500 Amsterdam Sloterdijk-Teleport 28,000 29,500 21,000 35,000 33,500 13,500 7,500 11,500 2,500 11,500 Amsterdam West 19,000 54,500 50,500 55,500 24,000 22,500 17,000 19,500 13,000 0 Amsterdam South Axis 31,500 13,500 94,500 36,500 35,500 46,000 75,500 26,500 51,000 11,500 Amsterdam Southeast 93,500 55,000 45,500 71,500 65,500 37,500 39,000 66,000 75,000 8,500 Amsterdam North 1,000 0 14,500 16,500 16,500 0 2,500 1,500 5,500 1,500 Amstelveen 16,000 35,000 72,500 22,500 4,000 14,500 8,500 6,500 12,500 1,500 Diemen 1,500 4,500 24,500 2,500 6,000 0 500 5,000 0 3,000 TRENDS IN OFFICE SUPPLY PER DISTRICT 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 H1 m2 Amsterdam Centre 142,000 190,500 130,500 136,000 109,000 139,000 150,500 135,500 168,500 162,500 Amsterdam Sloterdijk-Teleport 148,000 159,000 170,500 181,000 160,000 178,000 204,000 182,500 195,500 191,000 Amsterdam West 112,500 146,500 195,000 207,500 186,000 208,000 167,500 187,500 187,500 177,500 Amsterdam South Axis 186,000 206,500 184,500 194,000 147,500 131,000 91,500 81,500 72,000 81,500 Amsterdam Southeast 248,000 298,000 337,000 340,500 282,500 292,000 307,500 304,500 252,500 257,000 Amsterdam North 4,500 8,000 8,000 14,000 4,000 15,000 13,500 18,500 21,500 23,500 Amstelveen 114,000 106,500 94,500 72,500 109,500 126,000 144,500 159,500 171,000 172,000 Diemen 72,500 74,500 66,000 78,500 69,000 73,500 72,500 65,000 39,000 32,000 AVAILABILITY rates PER DISTRICT MID 2013 PRIME rentaL LEVELS PER DISTRICT MID 2013 % € Amstelveen Amsterdam South Axis Amsterdam Sloterdijk-Teleport Amsterdam Centre Amsterdam West Amsterdam Southeast Amsterdam Southeast Amsterdam North Amsterdam North Amstelveen Diemen Amsterdam Sloterdijk-Teleport Amsterdam Centre Amsterdam West Amsterdam South Axis Diemen 0 10 20 30 40 50 0 50 100 150 200 250 300 350 Source: NVM Source: NVM TYPICAL rentaL BANDS PER DISTRICT MID 2013 TAKE-UP AND SUPPLY IN AMSTERDAM 2 2 Amsterdam Centre 145 320 x 1,000 m2 Amsterdam Sloterdijk-Teleport 90 150 1,200 Amsterdam West 80 150 1,000 Amsterdam South Axis 230 330 800 Amsterdam Southeast 80 195 600 Amsterdam North 130 180 400 Amstelveen 100 180 200 Diemen 70 130 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 Supply Take-up Source: NVM NVM BUsiNess RANDSTAD OFFICE MARKET 2013 THE HAGUE AND SUrroUNDING toWNS After Amsterdam, the conurbation of The Hague has the space dropped significantly, also due to the lack of large- second largest concentration of offices in the Netherlands. scale tenants looking for premises. In addition, the number Nevertheless, this prominent position is only partly of small spaces – between 200 and 1000 m² - taken up in reflected in the take-up figures. Set against the total office Zoetermeer has dropped. On the supply side the situation stock, which is worth approximately 6.4 million m² in The is absolutely alarming, as the supply and take-up ratio Hague and surrounding towns, annual transaction volumes continued to worsen in 2013. This, however, is not only true are low. It is mainly because many office users are owners for Zoetermeer, but for other neighbouring municipalities which means they do not appeal to the open market. But in The Hague region as well. still, the letting market is not doing too bad. After a drop in 2011, recently demand for office space has been recovering The Hague, the city with the lowest vacancy percentage quite significantly. Last year 60% more office space was for years in the Randstad conurbation, has also been let and sold in the open market compared to the preceding witnessing more available floor area. This is mainly the year and if office lettings are a sign, then the figures for result of a large number of redundant government build- 2013 will be favourable as well. ings that have been coming onto the market. Although not all square metres are included, in a short amount of time Unlike in the past, the greater dynamics is mainly ensured the amount of office space on offer increased by almost by sectors like businesses services and the industry. Trans- 90.000 m². This has clearly affected the market sentiment. actions with e.g. 3M, APM Terminals, AT&T, Bird & Bird, To turn the tide to some extent, the authorities should CB&I Lummus, Damco, Huawei and Total clearly illustrate make the market feel more confident. Whether this will this. These transactions are not the only good news. Equally happen remains to be seen as the central government important was the decision of Nationale-Nederlanden to intends to drop more offices than it had intended earlier remain headquartered in The Hague. on, and mainly have fewer leased premises. Nevertheless, property agents are noticing a lack of high-quality supply Geographically, most dynamics in the office market can in The Hague, especially in the Central Station area. It be sensed in The Hague itself, with the city centre and is about buildings with a modern appearance and larger the Bezuidenhout district being the most popular loca- floors, which are preferably available for rent exempt from tions.
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