18 May 2015
Bouwinvest reported a robust investment performance in its 2014 Online Annual Report, with total assets under management rising 10.6% year-on-year to €6.7 billion and returns averaging 8.8%. The rebound in the Dutch market and a stellar 19.5% return from the international portfolio, turbo-charged by the strong U.S. dollar relative to the euro, underpinned the very positive annual results.
Bouwinvest Chairman Dick van Hal said: “Bouwinvest is now reaping the rewards of continuing to invest through the financial crisis. Last year we saw the first signs of a real recovery in our domestic Dutch market, with overall transaction volume doubling over the previous 12 months. The solid results of the global portfolio were magnified by the currency effect. Bouwinvest made a record €600 million of new investments in the Netherlands and €500 million in international listed and non-listed real estate funds in 2014.”
In the past year to January 2015, a total of five new institutional investors have entered Bouwinvest’s €2.7 billion Dutch Residential Fund — the largest single investment vehicle in this real estate sector in the Netherlands and the biggest investor in new rental housing developments in Amsterdam. The unleveraged core style fund generated a total return of 5.8% in 2014 and outperformed the market benchmark IPD Dutch All-Property Index for the fifth consecutive year and by a margin of 60 basis points.
The Dutch residential market has swung firmly into the sights of international and domestic institutional investors since the start of 2014, as prices recovered after falling by around 20% during the previous five years. Government measures to level the regulatory playing field for private investors versus social housing providers, to tackle a growing housing supply shortfall in the Netherlands’ main cities, as well as stricter controls on mortgage lending, will help support the residential investment market for the foreseeable future.
The €700 million Dutch Retail Fund produced a total return of 2.7% in 2014, while outperforming the IPD Dutch All-Property Index by 70 basis points. Retail projects under construction totalled just under €208 million. Bouwinvest is now the largest investor in new retail development projects in Amsterdam, which include:
- The Nowadays project on the main Damrak thoroughfare to the city’s central square will house flagship Zara, Primark and C&A value retail stores and is the cornerstone of a transformation of Amsterdam’s downtown retail offering that is underway.
- To the north of the capital, across the IJ River, Bouwinvest is developing the Mosveld community shopping centre that will be linked to the city centre with the opening of a new metro line in 2017.
- On the opposite side of the city, the Retail Fund is investing in a new shopping centre in the Stadionplein at the southern gateway to Amsterdam, opposite the historic 1928 Olympics Stadium.
The €700 million Dutch office fund generated a dividend return of 5.7% in 2014, with an occupancy rate of nearly 90%, or six percentage points more than the market average in the Netherlands. Highlight acquisitions by the fund last year included a €135 million investment in the World Trade Center in Rotterdam and the purchase of the two iconic “Citroën buildings” in the south of Amsterdam.
Dick van Hal concluded: “In a world of ultra-low bond yields and when stock markets are trading at very full valuations, property is offering institutional investors a stable long-term source of attractive income returns backed by real assets. We are confident that Bouwinvest will build on 2014’s positive results this year, while expanding in promising new areas such as healthcare real estate. We also expect to attract further third party institutions to co-invest in our commercial property funds alongside our anchor investor bpfBOUW – the Dutch construction workers pension fund.”
Bouwinvest’s 2014 Annual Report can be found at: www.bouinvest-annualreports2014.com