Business in the Spotlight CBRE

VACANT SPACE IN ZUIDAS: WHAT’S THE REAL STORY?

Zuidas has evolved beyond its beginnings as a 9-to-5 office district. With a wide diversity of different and new users, from innovative tech firms to residents, the area is developing rapidly. However, a recent article in one of our regional newspapers contended that Zuidas is experiencing an exodus of large companies that are packing up and leaving behind vacant buildings. We caught up with Joep van Vliet, head of research at the real estate consultancy CBRE, and Niels Hanssen, CBRE’s associate director, to find out what’s actually going on.

“Zuidas is developing in line with the domestic and global economy, so the fact that some companies are locating here and others are leaving constitutes natural turnover”, Van Vliet begins. Not only that, according to Hanssen, this state of affairs is in fact a good thing. “There’s a mutually reinforcing effect, and in a way it’s mainly symbolic. In the early stages of development, the majority of offices at Zuidas were dominated by large, financially driven companies and law firms, in buildings that were closed off to its surroundings. After all this time these tenants now take their next step; either at Zuidas or elsewhere. They’re leaving behind buildings that are being upgraded and made sustainable, and renovated to be suitable for multiple tenants.” Given the current innovative direction the economy is taking, in which the field is wide open for small enterprises to grow, there’s also a larger crop of small businesses, and they need that space. They want offices that are cutting edge and future-ready, prioritizing the building’s sustainability.

Rising rents A consequence of all these renovation projects with high quality standards is that rents are rising after a relative calm period during the pandemic. “Companies are always looking for the best buildings”, Hanssen explains. “In the aftermath of the pandemic, employers realise how crucial it is to create a place where employees feel at ease and are as productive as possible. What we’re seeing now is that companies with resources tend to choose the better buildings and are prepared to pay for them.” In actuality, both men say, Zuidas is more popular than ever. When it was fully let, companies did not find the space to grow. Hanssen suggests there were even companies that would have liked to locate to Zuidas, but went abroad due to the lack of space. Now all kinds of possibilities are opening up. “It just goes to show: newly available space can actually be quite healthy for an area like this.”

International calibre The coronavirus crisis has shifted the focus to the best buildings. And they are in high demand. “Walking around here, we may not realize it, but this is the premier location for international businesses to land in north-

“Zuidas is developing in step with the domestic and global economy”

western Europe”, Van Vliet points out. “It’s a springboard for further growth. So, as far as employment, economic activity and growth are concerned, Amsterdam is a linchpin for the entire country.”

Future Both Van Vliet and Hanssen applaud the development of a cultural sector alongside employment and housing in Zuidas. Moreover, as long as economic growth continues along its current track, the two say there is room for further rental growth. “Compared to other European cities, rental prices are still attractive here.” This new dynamic is set to propel Zuidas into its next phase of growth, towards a mature and complete urban centre, offering all the essential amenities.

CBRE Anthony Fokkerweg 15 (The Core) 1059 CM Amsterdam www.cbre.nl

Joep van Vliet & Niels Hanssen