THE NETHERLANDS

Office Market
Snapshot
Third Quarter | 2016

The Brexit vote has heightened economic uncertainty in recent

months, but activity in the office sector has remained relatively
robust. Companies are still showing a good appetite for capital
spending and expansion, helped by favourable credit conditions
and healthy profit margins.

Occupier focus

Occupier sentiment has been steadily improving in 2016 and

leasing activity accelerated further in key office locations in Q3.
There is a healthy flow of new requirements across the main
office markets, with modern, multi-functional buildings favoured
and locations in Randstad performing best. Amsterdam, in
particular, is seeing very strong demand in core submarkets,
where vacancy rates are falling. This is forcing some occupiers
to move to alternative locations where amenities and the quality
of stock are improving. Media and Technology firms have been
key drivers of demand in recent quarters. Prime rents were
largely unchanged in Q3, with pockets of rental growth being
seen in some central submarkets in Amsterdam.

Investment focus

Investment demand strengthened in Q3, with some investors

viewing Brexit as a potentially positive driver for the Dutch
office market. There is a significant amount of local institutional
and overseas capital targeting the sector, with a strong focus
on long-leased assets in key regional cities in the Randstad
area. With competition for the available stock intensifying and
prime supply in decline, prime yields have now gone below
5.00% in Amsterdams South Axis and Central submarkets.
Yields were unchanged across all other regional locations in
Q3.

Outlook

Market Outlook
Prime Rents:

Stable outlook, but rental pressure are building in

core submarkets in Amsterdam.

Prime Yields:

Further hardening of yields expected, given the

weight of capital targeting the office sector.

Supply:

Declining further. Speculative development has

improved, but new space is being absorbed quickly.

Demand:

Strengthening in both core and second tier locations,

especially for modern, multi-functional buildings.

Prime Office rents September 2016

LOCATION

SQ.M
YR

US$
SQ.FT
YR

GROWTH %
1YR
5YR
CAGR

Amsterdam (South Axis)

370

38.6

0.0

0.5

Amsterdam (Central)

315

32.9

6.8

3.1

Amsterdam (South-East)

195

20.3

0.0

0.0

Rotterdam

190

19.8

0.0

1.1

The Hague

195

20.3

0.0

-0.5

Utrecht

195

20.3

0.0

0.0

Eindhoven

170

17.7

0.0

0.0

LAST
Q

LAST
Y

Prime Office yields September 2016

LOCATION
(FIGURES ARE GROSS, %)

CURRENT
Q

10 YEAR
HIGH
LOW

Amsterdam (South Axis)

4.90

5.00

5.60

6.75

4.90

Amsterdam (Central)

4.90

5.00

5.90

7.00

4.90

Amsterdam (South-East)

6.40

6.50

7.10

8.50

5.50

Rotterdam

6.00

6.00

6.25

7.00

5.75

The Hague

6.10

6.10

6.30

7.00

5.75

Utrecht

6.00

6.00

6.50

7.25

5.75

Eindhoven

7.00

7.00

7.15

7.75

6.25

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.

Recent performance
Yield - Country Average
Rental Growth - Prime
9.00%
8.00%
7.00%
6.00%
5.00%
4.00%
3.00%

Yield - Prime
Rental Growth - Country Average

Sep-06 Sep-08 Sep-10 Sep-12 Sep-14 Sep-16

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property solely for information purposes. It is not intended to be a complete description of the markets or
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
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prior written consent is required before this report can be reproduced in whole or in part. 2016 Cushman &
Wakefield LLP. All rights reserved.

Thijs van den Brink MSc

8.0%
6.0%
4.0%
2.0%
0.0%
-2.0%
-4.0%
-6.0%

Rental growth (y/y)

The short term outlook for the office market is positive.

Occupiers are expected to continue expanding at a solid pace,
while investor demand for core and second tier assets should
strengthen further. Investment volumes are on track for a
record year in 2016, while take-up is also expected to surpass
2015 levels. Speculative development is failing to keep pace
with demand and the supply constraints in core locations are
forecast to continue.

MARKET INDICATORS

Yields

Overview

Consultant, Research, The Netherlands

Atrium 3rd floor, Strawinskylaan 3125, 1077
ZX, Amsterdam, The Netherlands
Tel: +31 (0) 20 800 2094
thijs.vandenbrink@cushwake.com
cushmanwakefield.com