US investor Jamestown is upgrading the historic Groot Handelsgebouw property in Rotterdam – its maiden buy in Europe – into a services-focused business and community hub. Thomas Sandlin, head of asset management Europe, details the plans.
US real estate investment and management company Jamestown is steaming ahead with plans to transform the majestic Groot Handelsgebouw (GHG) in Rotterdam into a multifunctional complex for innovative businesses and the local community.
A food hall, patio and cinema are just some of the elements being added or restored to boost the public function of the property, which dates from 1953 and is an icon of Rotterdam’s post-war regeneration.
Jamestown purchased the 122,000 m2 complex in late 2019 from HighBrook Investors for €289 mln, marking its first acquisition in Europe. A year and a half earlier, HighBrook had paid around €169 mln for the asset.
Located next to the city’s central railway station, the Groot Handelsgebouw fits seamlessly with Jamestown’s strategy of repurposing heritage industrial buildings. It was designed to help fulfil an acute need for office space following the end of World War II and served as a ‘showcase’ for wholesale businesses as they sought to rebuild their trade. The eight-storey property was one of the biggest buildings in Europe when it opened its doors eight years after the end of the war.
Besides being a hub for traders, it housed a grand café-restaurant and conference rooms, three interior open-air courtyards, shops on the ground floor and, from 1961, a cinema on the roof. And, in an early form of last-mile distribution, it even had routes running through the building for goods deliveries.
Boosting the mix
Jamestown now plans to breathe new life into the listed property, which has functioned primarily as office space over the last few decades, by adding hospitality, retail, art and leisure to the mix. Above all, the US firm wants to ‘give back’ the building to the city and its users, extending its legacy for a new generation.
'Because the building was increasingly used as an office, it also became less and less open, until people wondered what was actually happening there,' says Thomas Sandlin, head of asset management at Jamestown Europe.
The new food hall, due to open next year, will replace grand café-restaurant Engels which had been located in the building since the outset but was forced to shut down in 2020 amid the Covid crisis. ‘The [food hall] concept really has a public function in the GHG, just like the patio on the first floor, which we are going to restore to its former glory. The building really needs to be part of the sidewalk again,’ says Sandlin.
The firm is no stranger to the food hall concept, which has also been incorporated into its Chelsea Market (New York) and Ponce City Market (Atlanta) transformation projects. In other ways too, Jamestown is applying its experience from makeover projects in the US – which include Ghirardelli Square in San Francisco and The Innovation and Design Building in Boston - to its redevelopments in Europe. In 2020, the firm brought the Collision Project, which connects artists to site-specific public art opportunities, to GHG in Rotterdam for its European debut. This initiative, part of Jamestown’s mission of connecting communities through art, is also in place in Industry City in Brooklyn (New York) and Ponce City Market.
Other moves to bring the buzz back into the Groot Handelsgebouw include restoring the Kriterion cinema above the main entrance, once a key public attraction.
Flex work formats
Meanwhile, steps to enhance the office space in GHG, one of the largest multi-tenant business buildings in the Netherlands with more than 450 occupiers, were initiated under HighBrook, which overhauled the lease model in the small business section known as Kleinhandel by offering flexible terms and access to in-house facilities.
Building on this, Jamestown recently expanded the Kleinhandel co-working section by 600 m² and is converting part of the space into ‘spec suites’. Explains Sandlin: ‘These are spaces we can deliver turnkey according to the wishes of slightly larger companies that need an office fast with a lease term of 3-5 years.’
At the same time, he says, GHG is still attracting large new tenants: oil company Q8 recently took 2,800 m² of space for its European headquarters, while flexible workspace provider CIC is another big occupier.
The 450 office tenants, ranging from SMEs to multinationals, have access to a range of services, from shared mobility to health and sports facilities, and weekly events.
Says Sandlin: ‘What all these people have in common is that they want to be together. Especially after the pandemic, employees need an incentive to come to the office. Besides the growing need for space among new manufacturing companies and creative entrepreneurs, an office must have added value, for example because you meet like-minded people there or because you can enjoy yourself outside of work - also with your partner or your child.’
Rooftop terrace
That goal, using food, entertainment and culture as a unifier, has already been achieved in Atlanta, where Ponce City Market features a Skyline Park on its roof complete with cocktail bar and a mini golf course.
To give a taste of things to come at GHG, Jamestown introduced The Rooftop this summer –a rooftop terrace combining arcade games, an immersive maze, ribbon gallery, and food and drinks bar with views over the city centre. The initiative runs until the end of the year.
GHG is not Jamestown’s only asset in the Netherlands; the firm also owns the historic A-Factorij building and Helicopterstraat property (four buildings) in Amsterdam’s Schinkel district. The properties were acquired in 2021 in partnership with E.ON Pension Trust, the pension fund for one of the largest German energy companies, and the RAG Foundation. In the same year, Jamestown also acquired an office asset consisting of three buildings in Cologne, Germany, where its European team is headquartered, and an office property in Lisbon, Portugal. Together, the firm’s European assets under management now amount to around €1.1 bn (out of $13.2 bn worldwide).
Jamestown is keen to expand its European presence further, despite the challenges posed by working with listed buildings. ‘Removing things that have been added over the years creates opportunities and surprises,’ points out Sandlin. ‘Upgrading a national monument has one major disadvantage. ‘Literally every part of the building that passes through our hands falls under the supervision of the monuments committee. This is of course at odds with the view of most investors and developers, who want to optimise their assets as quickly as possible. For us, upgrading real estate and locations with a monumental value is the starting point, even if it means that you can only sell an asset in 15 years.’
Nonetheless, the US ‘adaptive reuse’ specialist continues to see ‘many opportunities’ for future growth in Europe, according to its president Michael Phillips. ‘Our vertically integrated team structure is at the root of our value-add asset management strategy enabling us to create innovative spaces while simultaneously preserving cities’ industrial pasts. As our European footprint expands, we will continue to focus on sustainable, adaptive reuse projects that bring new life to local communities.’
This article, including a Q&A interview with Jamestown president Michael Phillips, will appear in the September/October edition of PropertyEU Magazine
