Amsterdam is een winning city, volgens Schroders. In een uitgebreid artikel geeft Oliver Kummerfeldt, European Fund Analyst Real Estate bij Schroders, aan waarom Amsterdam momentum heeft. Hij is enthousiast over haar economische diversiteit, dynamiek, innoverend vermogen en groot aanbod van geschoolde arbeidskrachten. Hij is vooral zeer te spreken over de booming tech sector in Amsterdam. Kummerfeld ziet dat de stad zich voorbereidt op de toekomst en de technologische transformatie omarmt die de manier verandert waarop haar bewoners werken en leven. En ondanks die transformatie, weet Amsterdam volgens hem zijn unieke, aangename, dorpse karakter te behouden.
A postcard from Amsterdam
Tulips, windmills, bikes and canals are the first images many people have when thinking of Amsterdam. But behind this picture, the Dutch capital shows an incredible momentum and has the credentials to be one of Schroders “winning cities”.
What stands out is Amsterdam’s economic diversity, its innovation and a deep pool of skilled labour. Leading the way is its booming tech sector. Uber has its international HQ in Amsterdam and announced in March 2017 that it will more than double its staff when moving to their new 8,300 sq m office in the "The Cloud" in the centre of the city. And there are other big names based in Amsterdam including Booking.com, Netflix, TomTom, WeTransfer and Adyen.
Amsterdam’s success is explained by a number of factors. It starts with the healthy mix of large companies and a strong start-up culture (the city is ranked 5th out of 60 European cities in start-up category of the 2016 European Digital cities Index) mixed with a generally entrepreneurial and liberal mind set that encourages innovation. This is complemented by the availability of a young and well-educated workforce. The University of Amsterdam (UvA) is the largest university in the Netherlands by enrolment with 30,000 students and an international reach. Around 150 degrees are taught in English, attracting more than 3,000 international students from more than 100 countries. English is also widely understood among the population with studies estimating that 90% of the population can communicate in English. This is a big plus for business and expats’ ability to integrate into everyday life. And finally there is a high quality of life, with a range of cultural and social institutions and events, appealing architecture in the central areas and a welcoming and effective city administration.
What does help the thriving tech sector of course, too, is the fact that Amsterdam is home to one of the biggest and fastest Internet Exchanges in the world. The Amsterdam Internet Exchange (AMS-IX) is the largest internet hub in Europe, and 2nd largest in the world with 11 out of 15 transatlantic sea cables are landing in Amsterdam. This and the aforementioned points have also led some commentators to speculate about some tech companies potentially looking to relocate to Amsterdam from London following the Brexit vote.
Amsterdam’s forward-looking and tech-driven transformation becomes also very quickly visible on the cities’ streets. Amsterdam is now one of the leading cities with regards to electric transport. From taxis to private cars, delivery vehicles and public transport, the cities has one of the highest densities of electric cars on the roads. That goes along the highest density of charging stations in the world and with the Amsterdam City Council aiming to have 4,000 charging points in the city by 2018. And Fastned, a young Dutch company is now building a network of charging points along the Dutch motorway system.
It goes even further with people in Amsterdam paying for parking by App and parking enforcement being done by “Google-street-view-style”-camera cars with automatic number plate recognition patrolling the streets. And even the Netherlands real estate sector is increasingly driven by technology. Often called “the smartest building on earth, Deloitte’s “The Edge” building is a prototype for technology in the workplace and it was no surprise to see, that the main theme of this year’s “Provada”, the largest Dutch real estate fair, was Proptech.
Amsterdam’s transformation has also been driven and supported by its infrastructure. Statistically, there are more bikes than people in the city and with around 400 km of bicycle lanes, leading to estimates that 40% of commutes are by bike. The city also has an excellent bus, tram and metro network that integrate seamlessly with local and regional train services, with just one single chip card similar to London’s Oyster card. The long anticipated new metro line (commonly referred to as the North-South line) is now planned to come into operation in 2018 and will significantly boost the connectivity between the Zuidas CBD, the city centre and the boroughs located north of the river.
Being a trading nation and with over 180 different nationalities living in the city, it is perhaps no surprise that Amsterdam’s Schiphol airport is the third busiest airport in Europe. It was recently named the No. 1 European airport for direct connectivity by the Airport Council International, overtaking London’s Heathrow airport which is now at full capacity. Schiphol already has six runways and has started construction on an additional terminal to further boost capacity.
These infrastructure investments will support future growth. The city of Amsterdam alone is expected to add 150,000 new inhabitants in the next 15 years while metropolitan Amsterdam (2.4 million people) and the huge Randstad region, one of Europe’s largest urban areas (7.1 million people), keep growing in size.
Amsterdam’s dynamism is reflected in its office market. While there remain areas that continue to see outdated office space in mono-functional settings, for the market overall, the days of high double-digit vacancy rates seem gone. Real estate adviser JLL estimates that between 2012 and 2016 ca. 2.8 million sq m of vacant office space in Amsterdam has been withdrawn from the market with the majority transformed into residential or hotels. Office vacancy is now at around 9% and with the municipality currently requiring a level of 70%-pre leasing for a project to be given planning permission, future supply should be low (and the market will hopefully not see a repeat of the oversupply and construction spree of the past). Higher levels of demand, and tighter supply, have already let to rental growth in the Zuidas (South-Axis), the main CBD area of Amsterdam. Rents in other parts of the city are slowly increasing. This is not only true for the canal-district, but also for Amsterdam South-East around the arena. There remain however some areas, that face ongoing challenges and investors need to remain selective.
The Zuidas is also set to see further transformation with ambitious plans to secure and boost connectivity and develop a new suburb. A 2km extension of the A10 motorway underground will provide space for an extension of the existing railway station. Already this has stimulated a number of new residential schemes in the area alongside new public spaces to provide a more mixed-use environment and drive new urban development. The project is scheduled for completion in 2028. The Sloterdijk area is also scheduled to see further urban development to transform a mono-structural office location into a lively neighbourhood to “work, live and play”.
Despite the huge transformation, Amsterdam has preserved its unique, cosy village-feel in many areas. At the same time, it is clearly setting itself up for the future and prepares for further growth by embracing technological change that is currently transforming the way we work and live. It’s good to be prepared: As the Dutch would say “Het getij wacht naar niemand” (The tide waits for no one).