Utrecht Office Market Profile - Q4 2013

12 Month
Summary Statistics Q4 13 Q-o-Q Y-o-Y Outlook
Take-up (000s sqm) 59 522.5 % 127 %
Vacancy Rate (%) 14.3 130 bps 170 bps
Prime Rent (psm) 215 0 % 0 %
12 Month
Q4 13 Q-o-Q Y-o-Y Outlook
Capital Value (psm) 3554 0 % 0 %
Prime Yield % 6.05 0 bps 0 bps
Change*
Change*

* % Change for Prime Rents and Capital Values calculated using local currency
Market Overview
Office take-up increased six-fold q-o-q with 59,260 sq m
taken-up in Q4 alone. The top five transactions of over
3,000 sq m each together accounted for 41% of the
quarterly take-up. In the largest transaction of the quarter,
the Ministry of Health, Welfare and Sport leased 6,270 sq
m in the new municipal office in the city centre, which will
be completed at the end of 2014. The second largest deal
occurred also in the city centre, where Rabobank took
5,500 sq m at Leidseveer 35. The redevelopment of the
central station and renovation projects around the city
centre, make this location increasingly attractive going
forward, also as the municipality promotes redevelopment
or demolishment of out-dated stock and actively seeks
developers interested in developing new schemes.
Obsolete space is being modernised, in the wake of shifting
occupier demand towards well-connected locations such
as the city centre.. There was only one completion in Q4
totalling 3,300 sq m, developed for an owner-occupier.
Construction is underway for the aforementioned municipal
office (66,750 sq m) in the city centre. Speculative starts
are unlikely over the next 12 months, as the municipality
aims to bring the vacancy rates down by adopting a more
restrictive new-build policy. Overall vacancy increased by
130bps q-o-q to 14.3% driven by corporate consolidations
and vacancy is expected to increase in the short term, as
public sector organisations are still consolidating and
reduce their real estate footprint. The long lease length for
public offices inhibits quicker space reduction and is likely
to slow down vacancy reduction. Prime rents remained
stable at 215 / sq m pa. The level of incentives increased
slightly to 10-15 month rent free on a 5+5 year contract in
the prime segment and 12-22 months for the same lease
length at the overall market level. Some upward movement
in prime rents is anticipated towards the end of the year,
as sentiment improves. Office investment activity fell from
79 million in Q3 to 28 million in Q4 2013. Prime yields
remained stable at 6.05% at the end of the year.
Figure 1: Take-up
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TakeUp 10yr Average

Figure 2: Supply and Vacancy Rates
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VacancyTotal VacancyRate
Vacancy Rate %

Figure 3: Prime Rents and Rental Growth
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Rental Growth PrimeRent
Prime Rent (psmpa) Annual Rental Growth*

Figure 4: Prime Yields
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9
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PrimeYield 10Yr Ave 20Yr Ave
Prime Yield (%)

Source all Charts: Jones Lang LaSalle










Utrecht Office Market Profile Q4 2013
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Jones Lang LaSalle Contacts

Olaf Vogelaar
Head of Office Agency Utrecht
Utrecht
+31 30 284 3064
olaf.vogelaar@eu.jll.com
Dr van Leeuwen
Head of Capital Markets
Amsterdam
+31 20 540 7912
dre.van-leeuwen@eu.jll.com
Michael Hesp
Head of Research
Amsterdam
+31 20 540 7851
michael.hesp@eu.jll.com
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