Syntrus Achmea Real Estate & Finance is to take part in a €300m makeover of Amsterdam’s red light district.
The PPP project – a co-operation with Amsterdam city council and housing corporation Stadgenoot – aims to transform part of the area into residential housing and increase the variety of shops.
According to Syntrus Achmea, the project already represents around €150m of real estate taken over by the council.
The Dutch investment manager said this amount could double when all planned takeovers in the area have been completed, including a number of properties owned by housing corporation Ymere.
Syntrus Achmea said pension funds would be able to subscribe to the investment and generate “stable and low risk returns of 4%”.
The council has in recent years closed dozens of coffeeshops and allowed many buildings to be converted to hotels, cafés and restaurants.
The local authorities have also purchased more than 110 windows used for prostitution and are planning to close another 40, resulting in the disappearance of almost one-third, according to a council spokesman.
Syntrus Achmea emphasised that the redevelopment would take place within existing premises as they were all listed buildings.
In return for participating in the project – named 1012 Inc after the local postcode – the investor has been granted the right to build 750 residential mid-segment properties at four sites in the city, the council confirmed.
Syntrus Achmea said this would be an investment of around €150m, which would also become available to pension funds.
It said the locations were in the north, southeast and west of Amsterdam as well as in Zeeburgereiland.
The completion of 1012 Inc will take between 10 and 15 years.
Stadsgoedbeheer, a subsidiary of Stadgenoot, has been tasked with the implementation.
Amsterdam’s city council is to take a final decision on the project early next month.
At the IPE Real Estate Conference & Awards in Amsterdam last week, mayor Eberhard van der Laan said the city needed “huge numbers” of residential property to be built during the coming decade.
In an opening keynote address, van der Laan told delegates that the city is faced with rising residential prices, driving people out of the city.
Offering his hand to institutional investors, he pointed out that house prices in the Dutch capital were rising faster than in London, and that housing was becoming unaffordable for locals because of foreign buyers outbidding them.
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