More investors from Asia-Pac targeting the Netherlands
Logistics is driving the Dutch market which, thanks to its established ESG credentials, is now attracting more international investors, experts told Real Asset Media’s recent Netherlands Investment Briefing.
“We’ve seen an incredible influx of money into the country and we expect this trend to continue at a rapid pace,” said Onno Adriaansens, co-chair European real estate group, lead real estate desk the Netherlands, RSM. “More capital is now coming from the Asia-Pacific region than from the US and Canada.”
The shift has been noticeable, said Ralph de Munnik, country head, the Netherlands, CTP: “We see more foreign capital coming in, but there are less Americans and many more Asians. They land at Schiphol airport with bags of money they want to invest in logistics, seemingly limitless amounts.”
This demand is the reason the logistics sector has been breaking records and yields are now around 3%. Sustainable solutions are particularly sought-after by investors.
Power supplies can be an issue for Dutch logistics
Modern, automated logistics buildings use up a lot of power and there have been issues with supply in the Netherlands.
“The logistics market is very strong, but shortage of electricity is a problem because it limits what we can do, along with labour shortages,” said de Munnik. “Our next logistics park will be totally off the grid.”
CTP is already carbon-neutral in terms of its operations and intends that its buildings will be carbon-neutral as well by 2030.
“There is huge demand for renewable energy, driven by investors and asset managers that see it as adding value to their assets, making them more attractive and lowering energy costs,” said Joost Leendertse, founder & CEO, VerusSol. “But the problem is supply”.
Permitting process too slow for some
The focus on ESG has not been limited to environmental sustainability but it is encompassing the social and governance aspects as well.
Tenants are in a better negotiating position, whether they rent warehouses, apartments or offices, and they can demand better services and amenities.
“We pay a lot of attention to the social aspect of our parks,” said de Munnik. “We try to create a social environment and an eco-system in which people are happy to work, adding sports facilities, club houses, restaurant, small shops and so on. This is the reason why every single Dutch municipality we have dealt with has been very supportive of our plans.”
Not everyone is happy with the pace at which authorities work in the Netherlands.
“New developments are much needed in the country and municipalities should move much faster in granting permits for brownfields,” said Leendertse. “The electricity supply issue should also be sorted out. The Netherlands should hurry and fix the problems there are.”
