Last month we opened a new office in the center and to mark the occasion we are publishing an Eindhoven Market Update, discussing the office market and the logistics market.
Start-ups, scale-ups and corporates like to connect with "the smartest region in the world. The Eindhoven office market has been quite stable for years, the publication shows. Office take-up is around 50,000 m² annually. This mainly involves relocations within the city limits and rental transactions under 1,000 m². Over the past three years, only 18% had floor space larger than 1,000 sq. ft.
"At the beginning of the corona crisis, companies were very cautious with their growth plans and we heard signals that organizations were divesting office space," says Ramon van Stekelenborg, Director Agency in Eindhoven. "Two years later, we still don't see this effect. Indeed, the vacancy rate has even decreased."
Office stock growing
The declining vacancy rate is basically good news for the large new construction projects that were already in the planning. In fact, more than 100,000 m² of office space will be added in the coming years. These are mainly sustainable and quality offices in the city center. This will increase the current office stock of 1.9 million m² by approximately 6%.
However, major developments such as District-E, Lichthoven and The Edge are still waiting for a ruling from the Council of State before they can start. "There is a good chance that these projects will be completed almost simultaneously," says Van Stekelenborg. "New office supply will then flood the market. Fortunately, companies like ASML, Sendcloud and Lightyear are proof of the region's innovative strength. Eindhoven has it all. If we propagate that more, those offices will be filled in no time."
High demand for logistics
Demand for industrial and logistics real estate continued to increase during the corona crisis. Now the readand is less than 3%, while it was still over 5% at the end of 2019. Logical consequence, is that the supply also decreased. New construction, however, is becoming difficult. There is increasing resistance to "doom.
Van Stekelenborg: "North Brabant is further tightening the rules for large distribution centers. Construction of the often enormous new developments is only allowed on business parks near Tilburg, Veghel, Heesch-West and Haps. XXL distribution center developments on existing business parks are also further regulated. We therefore expect this market to become very tight and prices to rise substantially."
Kindly note that the report is in Dutch.