The Dutch logistics sector is already doing well but it is set to receive a further boost from Brexit, experts agreed at Investment Briefings’ Netherlands & Europe Panel, which was held in Amsterdam last week.
‘Brexit has triggered more interest in the Dutch real estate sector, with banks coming and looking for offices and residential also boosted by the transfer of the European Medicines Agency from London to Amsterdam,’ said Hein van der Meer, Partner, CMS. ‘But it is Schiphol airport, Rotterdam port and all our good logistics infrastructure that will be much busier after Brexit.’
The country is extremely well placed for logistics, but geographical location is just one element of the offering, along with excellent infrastructure, a good transport network and a well-developed market.
‘For our customers logistics used to be a necessary evil, a place to store goods and move boxes out, but now it has become the centre of their operations,’ said Sander Breugelmans, Vice President, Country Manager Benelux, Prologis. ‘If you think of Amazon, our biggest customer worldwide, it is all about logistics. Whatever the economy does, e-commerce will keep growing. We expect it to double over the next five years.’ Prologis has 2m m2 in Benelux.
Offices will continue to make up at least 50% of Union Investment’s portfolio, but there is a new interest in logistics, said Martin Schellein, Head Investment Management Europe, Union Investment Real Estate: ‘There will be no firesales, but our plan is to reduce our exposure to retail over the next five to ten years and strengthen our logistics portfolio. It is a very healthy market in the Netherlands.’
The sector offers different value creation opportunities, said Alexander Fischbaum, Managing Director, AF Advisory Ltd: ‘We like refurbishing retail warehouse parks, we subdivide and then allocate part of it to logistics. In an environment where yields are so low, we focus exclusively on value creation, where we can come up with an asset management plan, be hands on and implement the plan. We like to shape our destiny when possible, rather than let the market take control.’
Yields have compressed in the sector but ‘logistics still has an attractive spread compared to other asset classes,’ said Breugelmans. ‘In the next few years value creation will come from rental growth.’
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