- Office take-up during first six months of 2017 at highest level since corresponding period 2008
- Office vacancy drops by over 500,000 m² during six months to 13.1% of stock
- Large cities remain popular, but demand is spreading out
Office take-up in the Netherlands during the first six months of 2017 totalled 581,000 m², which is the highest take-up during a January-June period since 2008, and is 13% up on take-up figures for the corresponding period in 2016. This appears from the latest figures released by Cushman & Wakefield.
If this trend continues in the second half of the year, take-up for 2017 as a whole will total 1.4 million m2. Although the five largest cities in the Netherlands remain popular, it is also clear that other municipalities are benefiting from the rising take-up. Also, the first half of 2017 saw an accelerating decline in office vacancy, down by over 500,000 m². Total office vacancy in the Netherlands currently stands at 6.4 million m2.
Office take-up can exceed 1.4 million m2
At 581,000 m², office take-up during the first six months of 2017 was higher than during the eight preceding corresponding periods. The all-time high dates from 2008, when take-up during the first six months totalled 700,000 m². Although take-up dynamics during that period in 2008 were higher than at present, current dynamics are significantly stronger than during the all-time low of 2010, when take-up during the first six months totalled 480,000 m². Except for a rare exception, take-up during the first half of the year is always lower than in the second half. In 2016, for example, take-up during the first half was 514,000 m², while 742,000 m² was recorded during the second half of the year. If this 'truth' also holds for 2017, then office take-up for 2017 as a whole could exceed 1.4 million m2 .
Source: Cushman & Wakefield
After eight years of trending upward, vacancy on the Dutch office market first started to drop in 2015 and has continued to do so since. That was also the case during the past six months, with signs of acceleration. Indeed, during the first six months, vacancy shrunk by over 500,000 m², in other words by 12% to 6.4 million m2. Expressed as a percentage of stock, vacancy during the first six months dropped from 14.1% to 13.1%. Besides vacancy, the market also offers office space that is not yet physically unoccupied. This category totalled 733,000 m² on 1 July 2017. Together, total availability amounts to 7.1 million m2.
Not every office building offered on the Dutch market has an equal prospect of finding a user. Of the total availability, 19% matches the location and building specific preferences of offers users (high potential). The qualification medium potential applies to 48%, while 33% of availability is regarded as low potential. Of take-up during the first half of 2017, 47% involved office space that six months earlier had been labelled high potential, 41% was in the category medium potential, and 12% in the low potential segment. When these percentages are applied to the take-up prognosis of 1.4 million m2 for 2017 as a whole, it becomes clear that the current availability of high potential office space is more than double the expected high potential take-up for 2017; the corresponding ratios for medium and low potential office space are 6:1 and 14:1, respectively.
Source: Cushman & Wakefield
A trend towards concentration, but also spread
The five largest cities accounted for 43% of national take-up, compared with 47% during the same period last year. In absolute terms, however, growth is still evident. A year ago, take-up in the five largest cities was 244,000 m², compared with 252,000 m² during January-June 2017. Nevertheless, at just over 3%, this growth is significantly lower than the national figure of 13%. It can thus be concluded that growth in the other municipalities has been stronger.
Frank van der Sluys, Head of Research Cushman & Wakefield: “Rising take-up goes hand-in-hand with geographical spread of demand. When take-up rises strongly, so too does the spread throughout the country. Initially, we saw that first in the medium-sized cities and municipalities. During the first half of this year, we saw that municipalities such as Amersfoort, Amstelveen, Enschede, Haarlemmermeer, Nijmegen and ’s-Hertogenbosch recorded significantly higher take-up levels than during the same period in 2016.”
Source: Cushman & Wakefield
Spread is also visible in the top 10 largest transactions. While during the first half of 2016, eight of the ten transactions were realised in the five largest cities, this has dropped to six of the ten in the past six months. The four transactions in the top 10 realised outside the five largest cities were recorded in Hoofddorp (2), Amersfoort and Amstelveen. The largest transaction during the first half of 2017 is the housing of Alliander Energie at Sloterdijk in Amsterdam, with an office take-up of 25,000 m².
Click here to view the fact sheets The Netherlands office and industrial property market mid 2017.
Note to the editors:
The Office Market Fact Sheet mid-2017 of Cushman & Wakefield is available here. Next week, we will release the Netherlands Complete bundle with all regional fact sheets for the office and industrial property market.
For further information, contact:
Frederike Lengers | Phone: 020 800 2048 | Mobile: 06 4688 1872
Sophie van Gorsel | Phone: 020 750 0410 | Mobile: 06 2238 2045