Savills

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Summer Special 2023

Article

Contacts & Related Research

Our very first Summer Special explores three main disrupters of Dutch Real Estate evolution: Decarbonisation, Demographics, and Digitalisation.

The volatile weather that has dominated the summer holidays has been a perfect metaphor for Dutch real estate markets characterised by uncertainty. Transactions have been the lowest in 10 years in both the investment and the occupier markets. The Dutch market will eventually emerge from the effects of the most overwhelming interest rate shock in decades. However, after this correction, the sector’s future will be shaped by these 3 forces that will leave it considerably different to the preceding 10 years.

Key findings:

  1. The need to de-carbonise the real estate sector has never been greater as it accounts for around 30% of the world's annual greenhouse gas emissions. The costs may be high, but there is mounting evidence of the benefits, with some office tenants willing to pay a rental premium for more sustainable offices, which can be as much as 17% in the G5 cities. There are a range of examples of recently developed real estate schemes that show the Dutch real estate sector can meet the challenges of decarbonisation.
  2. Companies, managers and investors, that are sufficiently informed about the impacts of demography will be better positioned to identify and enter property markets and segments with potential. Savills expects ongoing urbanisation, with continuous population growth of the country’s largest cities. This is expected to remain a dominant theme in the future and will influence the location choice of occupiers across all sectors in commercial real estate.
  3. Different preferences of newer generations will shape real estate demand in the future, and not only for housing. Research aimed at Millennials and Gen-Zs indicate a preference for mixed-used neighbourhoods that benefit from walkability. Savills expect it will contribute to a further shift by businesses as well as residents, towards properties in locations which have high quality amenities, affecting all real estate sectors.
  4. For the Dutch real estate sector to thrive during the tech dominated Fourth Industrial Revolution, occupiers, developers, and investors alike will need an open mind and embrace disruptive technologies to stay relevant. The impact of digitalisation across real estate sectors has been profound and will continue. For example, the number of online retail outlets grew 266% between 2013 and 2023, while the Dutch office landscape has been transformed by Working from Home in recent years, facilitated by digital developments.
  5. Data usage in the Dutch economy will continue expanding exponentially, generating the need for more datacentres. In a crucial discussion for the future welfare of the Dutch economy, developers will need to demonstrate to opponents of new properties, that developments primarily use green electricity and are built on brownfield sites and explain the expected contribution they can make to local and national welfare.

Owners and occupiers will have to continually adapt to the ongoing challenges brought about by the demands of decarbonisation, demographics and digital change. However, we at Savills, believe they will also be focused on exploiting the considerable opportunities that will be generated by these impacts.

Clive Pritchard, Head of Country at Savills in the Netherlands.