What are the opportunities for future growth of the industrial sector?

The Dutch industrial real estate market comprises approximately 237 million sqm of space divided over 130,000 properties. It is the second largest real estate segment after the residential market and has displayed tremendous growth over the past couple of years in the wake of the COVID-19 pandemic.

With a growing population, there is a strong need for additional industrial space. By estimation, every new-built home could generate an additional demand of 5.4 sqm of logistics space. The Dutch government has the ambitious plan to build 900,000 homes by 2030, which would indicate a significant increase in the industrial stock to accommodate demand. However, green field locations are becoming increasingly scarce and the industrial segment has to compete with various other claims on land (such as those for housing developments).

What are the opportunities for future growth of the Dutch industrial sector?
Approximately 110 million sqm of existing industrial space is facing the risk of obsolescence, which is almost half of the total Dutch industrial stock. These buildings are 30 years and/or older and in most cases no longer in line with current tenant requirements (e.g. technical, structural, energy efficiency et cetera).

These locations offer great opportunities for retrofitting while benefitting from other aspects that current business locations have to offer:
- -Properties on these locations may not have an optimal site coverage, providing room for expansion
- The correct zoning is already in place
- There is an existing connection to the electrical grid (mitigating the current congestion problem)
- There is existing infrastructure and the accessibility of labour
- There are opportunities to revitalize industrial estates through mixed-use