CBRE: Retail outlets in transition, logistics real estate breaks records

Changes in consumer behaviour lead to major shifts

Amsterdam, 27 January 2022 – The rapid growth of e-commerce is dominating the Dutch high street, both positively and negatively. While the logistics market is capitalising on structural changes in consumer behaviour, the opposite was true for retail property in 2021. The logistics real estate market has further strengthened the record-breaking investment volume of 2020 with a volume of €5.3 billion in 2021.

On the flipside of this success, the retail property market has bottomed out: price levels are now at the stage where surplus retail space is being bought to be transformed into homes or offices. Partly due to the lower price levels, the number of retail property transactions decreased to €1.6 billion in the past year.

These are the results of the Market Outlook 2022, published by CBRE Netherlands. In its annual Market Outlook, CBRE publishes and analyses the figures for the past year and provides a substantiated forecast for the coming year.

New opportunities
“The retail market is currently moving through the stages of grief,” says Lodewijk Buijs, Director Retail at CBRE. “The first stage is denial, followed by the acceptance stage and finally, the emergence of new opportunities. New players are exploring new avenues of profitability. New opportunities are opening up, partially driven by the sharp increase in house prices, making transitions financially interesting as well.’’

The top rents in all Dutch city centres declined, especially for retail space on upper floors or in basements. Rent reductions of around 50% for these areas have not been uncommon in recent years. As a result, the rents of retail space on the first floor and above have been cut so drastically that renovation into flats, offices or boutique hotels has become an attractive alternative. The former 62 V&D branches, some of which were later occupied by Hudson Bay, have been refurbished after becoming vacant. This transition is in full swing and in the next two years it will become increasingly noticeable in the shopping streets. The ground floor remains devoted to retail, with other functions occupying the upper floors.

Chains on the course for expansion
The low rent levels provide a range of prospects for retailers to successfully open new branches, as the overall operating costs have decreased. As a result, a number of chains remain on the course for expansion. Some examples include e-commerce company Coolblue, flash delivery company Gorillas and discount fashion chain TK Maxx.

The growing popularity of supermarkets and local retail properties runs counter to developments in the city centre. The long-term contracts and security of rental income attract a large group of investors. Hardware stores, large-scale shopping areas and shopping centres on the outskirts of town can also count on more interest. In their search for distribution locations for urban logistics, logistics investors are increasingly turning to retail properties. Due to the lack of suitable existing logistics buildings, they are buying up these retail outlets for redevelopment into transshipment platforms or a mix of housing, retail and logistics space.

Retail property regains momentum in 2022
This segmented interest will largely continue in the coming year. Nevertheless, CBRE sees more investors adjusting their risk profile. Driven by the fall in prices - and therefore in risk - more investors are targeting retail outlets with a larger share of rental income from tenants in the non-daily sectors. In the city centres, the conversion process continues, which gradually creates a new, more appealing identity for the city centre and further reduces risk.

Because a large part of the increased risks have now been incorporated into prices, CBRE expects the investment market to slowly pick up again in 2022 and the volume to recover slightly to around €1.75 billion. The main reason: more insight into the risk of retail property and hence an attractive return for investors.

Logistics investment market hits peak
The structurally higher demand for e-commerce is pushing the logistics investment market to unprecedented heights. Investors remain interested in the sector, despite the increasingly sharp initial yields. The expected rental boom due to shortages plays an important role in this regard. In 2022, the volume is expected to reach €4.5 billion, partly due to the shortage of new builds.

“From a real estate point of view, the commercial focus is partly shifting from the centre to the city outskirts and peripheral logistics hubs. And from there, deliverers are responsible for taking the final step to the consumer: the last mile. This kind of urban logistics entails new prospects and challenges, especially in terms of quality of life, which also plays a role in large-scale logistics. A high-quality, innovative and sustainable logistics space - and therefore a pleasant working environment - is an important weapon in the current labour shortage," says Jim Orsel, Head of Industrial & Logistics at CBRE.

Lower vacancy rates, higher rental prices
The demand for logistics real estate is rising faster than the supply, causing vacancy rates to fall. At the end of 2021, only 1.4 million sq. m. were still available for rent, which is equivalent to 3.8% of the logistics stock. By comparison, this amounted to 4.2% at the end of 2020. This fall in available space is driving up rents, a development that has been taking place for some time, especially in the Randstad conurbation. At the end of 2021, for example, the Utrecht region experienced a rent increase of around 15% of the sq. m. price compared to the end of 2018. In addition, the number of new complexes to be built is decreasing, further tightening the market.      

Although sufficient existing investment products are entering the market, CBRE anticipates a shortage of newly manufactured investment products in 2022 due to the difficulties regarding development and redevelopment. Jim Orsel concludes: “It is therefore unlikely that a new investment record will be set next year. In the Market Outlook, CBRE predicts a slight decrease in volume, towards a total of €4.5 billion. But the demand for logistic products remains high: growing competition will continue to put downward pressure on yields.”


About CBRE
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company with headquarters in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2020 revenue). The company employs more than 100,000 people worldwide and provides services in over 100 countries. CBRE offers strategic advice and guidance in property sales and leasing; corporate services; property, facilities and project management; appraisal and valuation; development services; investment management; and research and consulting. Please visit our websites at and