Vacancy rate office market to increase shortly

Too many new offices are presently being build. The vacancy rate will increase dramatically over the next few years. The NVB - Association of Dutch Project Developers gave a warning today.

Demand after new office space is decreasing, but project developers are putting another 2.6 mln sq. meters on the market over the next twelve months. These new projects are the result of the booming employment market during the past few years.

Now the economy is slowing down and companies do not want to expand too much, the NVB expects that only 1.1 mln sq. meters will be enough to meet market demand. However, roughly 1.9 mln sq. meters will come on to the market annualy over the next few years.

'The oversupply in office space will cause vacancy rates to increase, noticeably of elder buildings', according to Chairman N. Rietdijk of the NVB. Projects for which tenants have not yet been found are very risky. ICT companies, suffering most in the present economic conditions are sub-letting office space, noticeably in Groning, Western Holland and the Schiphol area, according to Rietdijk.

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(source: De Financiele Telegraaf)

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