Retail 2023

Publication

Waiting for a new price equilibrium in Dutch real estate

Article

Contacts & Related Research

Read the latest developments in the Dutch real estate market below

The report reveals that investment market activity significantly declined during the first quarter of 2023. Investors have adopted a cautious approach due to interest rate hikes by the European Central Bank (ECB) and persistent high inflation levels, which are expected to continue into 2024. As a result, only €1.7 billion was invested in the Dutch real estate market in Q1, compared to an average of €4.7 billion over the previous eight years.

Key findings

  1. The report reveals that investment market activity significantly declined during the first quarter of 2023.
  2. Alongside the weaker investment market, the report also highlights a slowdown in occupier activity, particularly in the logistics sector, which had previously benefitted from demand during the Covid-19 pandemic.
  3. Office take-up has also decreased significantly, down by 50% in the first quarter of 2023 compared to the same period in the previous year.
  4. In the first quarter of 2023 new price corrections took place in the market, with increases in gross initial yields (GIYs) across all sectors.
  5. Savills expects a a pick-up in investor activity after financial markets stabilise, which is expected in the second half of 2023.
  6. Despite a more challenging economic backdrop, logistics, prime offices and residential properties in desirable locations are expected to experience rental growth due to a shortage of high-quality stock.

The widening bid-ask spread in the market has led to a drop in investment activity, with volumes down by 62% in the first quarter of 2023 compared to the previous year.

Clive Pritchard, Head of Country