Signs that the Dutch economy has hit the bottom of the cycle and appears to be stabilising will spark renewed interest from investors wishing to take advantage of price readjustments before a full recovery, property adviser Savills said.
Signs that the Dutch economy has hit the bottom of the cycle and appears to be stabilising will spark renewed interest from investors wishing to take advantage of price readjustments before a full recovery, property adviser Savills said.
According to Savills, major high street property yields moved out up to 125 basis points to 5.5% but have stabilised throughout 2009. In secondary locations yields are at between 7-7.5% while in shopping centres prime yields stand at 6.5%. Retail warehouse yields are at 8%. This pricing readjustment, says Savills, means now is the time for investors with capital to buy before an increase in sales in 2011, followed by a significant boost in take-up in 2012, which will spark larger investment volumes.
Savills notes that the market has seen a number of new entrants in 2009, despite a take-up of 230,000m2 over the first nine months compared to 430,000 m2 in the same period in 2008. United Nude, In Fine, French Connection, Koton, New Look, Primark and Brandnew Store have all launched in the Netherlands this year. Furthermore, within the food market sales have remained stable and a bid by supermarket chain Jumbo to extend its 128 network by taking over 300 supermarkets from Super de Boer signals a significant shake-up in this sector.
Jan Peter Hebly, Savills' managing director of retail in the Netherlands, says: 'The retail market is facing challenging times with low sales and short-term forecasts not being positive. These are the times where the good retailers will prove themselves. The same goes for the property market: transactions are low and interest is mainly focused on prime locations. For investors with capital this market does offer interesting possibilities.'
