New Marketview on the Dutch Retail Property Market
The retail sector lags behind the development of the GDP. The first signs of economic recovery and the moderately positive forecasts for this year will therefore fail to have direct positive impact on the retail sector.
Witnessing a relatively low result on turnover in the first eleven months of the previous year, retailers were hoping to catch up in December. The first figures, however, prove that Christmas spending was simply yet another disappointment. This means that a number of retail chains, which so far had been adopting a ‘wait-and-see’ attitude, will possibly have to dispose of certain units. With demand level failing to rise, the letting market will further widen as a result of which the rent level will probably continue to drop. Although market widening will be the case in all retail property categories, prime retail space will continue to perform better compared to the other categories.
The retail investment market is showing another picture than the letting market. Although last year’s transaction volume of € 993 million was much of a letdown, there is also room for optimism. Since both the number of investment transactions and the size of these transactions increased, volume doubled in the second half of 2009 compared to the year’s first six months. The positive market trend is expected to continue in 2010. Because initial yields had reached rock bottom at year-end 2009, increasingly more investors have entered the market’s buy side. Despite the fact that the market is picking up, large-scale deals and major portfolio takeovers will still be an exception, as these deals are still virtually impossible to finance.
The above developments within the Dutch retail market have been described in detail in the last edition of Market View, published by real estate advisor CB Richard Ellis. Click on the pdf below to view the full English report.
Dutch Retail Property Market Marketview
