NETHERLANDS Trends and Developments Contributed by: Coco van Zuiden, Marijn Bodelier, Sabine Schoute and Simone Wijngaard, Greenberg Traurig, LLP
Sale-and-Leasebacks The sale-and-leaseback of real estate involves the owner of a real estate asset selling it to a third party after which that party then imme - diately leases the asset back for a term at an agreed rent. Although this trend is not new (it started during the COVID-19 pandemic), we still see that sale- and-leasebacks are on the rise. Some compa - nies are facing difficulties with raising capital, which makes them financially fragile. To limit any negative financial impact, many companies have turned to alternative ways of raising financing, for example, by means of liquidating their real estate assets and leasing them back. In addi - tion, distressed sales and non-performing loans – often the case in this current market – have resulted in various sale-and-leaseback transac - tions. From an investor’s perspective, sale-and- leasebacks are also quite popular as an asset class because stock markets are clearly more volatile. Other key advantages of sale-and-leaseback transactions include: • immediate cash injection; • freed-up capital; • no relocation of activities; • debt reduction; and • increased flexibility. Further Development of the Industrial, Logistics and Data Centre Sectors Not only in the Netherlands, but across the European markets, there is growing demand for urban logistics real estate, as well as industrial logistics, due to the constantly growing e-com - merce business, combined with the fact that the Netherlands is Europe’s logistics hotspot due to its high-quality infrastructure, large ports and
central location. There are still many develop - ments in the more southerly part of the Nether - lands, which are mostly arranged via a forward- funding structure (see the next section), although many transactions also relate to existing assets. There is also a strong appetite for data centres in the Netherlands. The data centre market is booming and the Netherlands is often seen as the data hub in the heart of Europe with a unique infrastructure and ecosystem for the data-driv - en economy. Notwithstanding its growth, the Dutch data centrer market faces various chal - lenges, such as high energy costs, competition for skilled personnel, limited land availability for expansion, power grid congestion and regula - tory constraints related to environmental impact. Rise of Student Housing The demand for (affordable) student accommo - dation – particularly in the larger student cities in the Netherlands – is growing and the require - ments for accommodation also evolve. More students are looking for an independent, well- equipped room or studio with good amenities (living as a service). This effectively means that the demand for new accommodation and trans - formation of vacant buildings becomes interest - ing for various players on the real estate market. Forward-Funding Structures In the Netherlands, real estate developments are often acquired in future state of completion. This kind of transaction can be structured as a forward funding, but also as a forward purchase (also known as a “forward sale/forward commit - ment”). In a forward-funding structure, the sale – and thus the transfer of ownership – occurs prior to the completion of the construction works and
701 CHAMBERS.COM
Powered by FlippingBook