Friday, 13 March 2015
Savills reports that Dutch property market will show further yield contraction
According to a recent report by Savills, Dutch property market investment was ‘off the charts’ in 2014 at €6.7 bln, and saw two thirds of buyers originate from abroad. The firm says 2015 will see growing investor demand, including more activity from Asia following the recent purchase by Singapore’s First Sponsor Group Limited. Coupled with activity triggered by the QE programme from the ECB, Savills predicts yields will be driven downwards 20-40 basis points.
Savills research suggests that with yields in the Dutch market currently still above 2007 levels, unlike many other European markets, pricing is favourable for cross border investors. The firm reports that with UK and US investors focused on lot sizes of over €200 mln, portfolios have sold well.
Clive Pritchard, head of Savills Netherlands, says: “As investor appetite is only growing, the Dutch property market is up for another strong year. The interest from Asia is exciting and we are in a strong position to take this forward through Savills global platform.”
In terms of take up, Savills notes that the three major commercial property markets are showing substantial differences. The industrial market is tipped as the sector which will see significant increases in occupier demand, following e-commerce growth – 2014 saw a +9.8% increase and 2015 is anticipated to see an even larger growth as long as new developments can keep up. However the retailers themselves are likely to be driven by opportunistic moves to prime spots as well as some consolidation. The office market, despite a slight increase in take up last year, will see 2015 activity sparked by consolidation and whilst this may push up the number of transactions it will not necessary see a larger volume transacted.
Jeroen Jansen, head of research at Savills Netherlands, comments: “With the ecommerce sector forcing the logistics market forwards the Netherlands is strategically located to benefit from this increase in activity. The country’s overall employment rates look positive, when compared to other European countries, and this will see a positive impact on household consumption.”