Portfolio composition at year-end 2016:
A total of 15,329 properties across the Netherlands
Total value investment properties of € 3.5 billion
Diversification guidelines and investment restrictions
The Fund applies a defined set of Investment Restrictions in the execution of its strategy. The Fund will adhere to the following Investment Restrictions to focus on its core activity and to limit risks.
Diversification guidelines | Current portfolio | Conclusion |
≥ 80% of investments invested in core regions | 92.1% in core regions | Compliant |
Investment restrictions | | |
< 5% invested in single investment property | There is no single investment property exceeding 5% of the total portfolio of € 3.9 billion | Compliant |
< 10% invested in non-core (non-residential) properties | Investments in non-core properties are 0.9% | Compliant |
< 10% pre-finance acquisitions | Investments under construction are < 10% | Compliant |
No investments that will have a material adverse effect on the Fund’s diversification guidelines | There have been no investments in 2016 that have a material adverse effect on the Fund's diversification guidelines | Compliant |
Time to market: investments and divestments in 2016
The Fund is backed by its investors. This enabled the Fund to acquire some very high-quality housing products in Bouwinvest's core regions. Just over half of the acquisitions in 2016 were in inner-city locations in the Randstad urban conurbation, with the remainder in other core regions.
Investments
Acquisition of 11 projects for a total of € 255 million
As a result of our active focus on the acquisition of new properties, we reached agreements on a total of:
The 11 acquisitions are described below.
Het Nieuwe A, Arnhem – 48 family homes
Rental range: € 850 - € 950 per month
This complex consists of 48 extremely energy efficient homes in Malburgen West district of Arnhem. Malburgen West has seen large scale area development in recent years, with large numbers of social homes demolished and replaced with new-build owner-occupier homes. This part of the neighbourhood now consists largely of owner-occupier homes and is conveniently located near the Rhine river and a park. Thanks to the nearby Nelson Mandela bridge, Arnhem city centre and the new train station are just a few minutes’ walk away, or a short trip by bike, public transport or car. The homes have an EPC of 0 and are therefore very energy efficient. In addition to the solar panels on the roof, these homes have been fitted with solar panels on the facade.
Saksen Weimarlaan, Arnhem – 28 apartments
Rental range: € 900 - € 950 per month
This new residential neighbourhood has been built on the site of the former Saksen Weimar barracks in Arnhem North, with new buildings added to former Ministry of Defence barracks, which have been renovated and repurposed. These now include spaces for artists, a restaurant, various companies and residential tenants. One of the final new-build developments added to the complex is an apartment building, which the Fund has added to its pipeline located in the popular, wooded neighbourhood Klarenbeek in Arnhem North. This is a small-scale complex, with 28 three-room apartments of 80 m².
Landgoed Alverna Villa II, Aerdenhout – 36 apartments
Rental range: € 1,644 - € 2,126 per month
Landgoed Alverna is part of a redevelopment plan in the village of Aerdenhout, the municipality of Bloemendaal. The estate is located on the edge of the village and the local woods, close to the Heemstede-Aerdenhout train station and local shops. Villa II is finished to a high standard and includes 36 senior citizen’s apartments on the ground floor and first three upper floors. The nine apartments per floor guarantees a high level of privacy and all the apartments have beautiful views across the Landgoed Alverna estate and the surrounding green areas. These are high-quality apartments with luxury kitchens complete with built-in appliances, luxury bathrooms and spacious balconies. All the apartments have separate storage rooms and a parking space in the basement. Villa II offers apartments varying in size from 109 m² to 148 m².
Hof Van Pampus, Hoofddorp – 74 apartments
Rental range: € 875 - € 1,033 per month
The Hof van Pampus apartment building is located in Hoofddorp in the municipality of Haarlemmermeer. The Hof van Pampus project contains 74 apartments with separate storage rooms on the ground floor, as well as 101 on-site parking spaces. The design is modern and spacious. The building has seven floors, with a higher section on the west side of the building. Most of the 74 homes will be three-room apartments, with five two-room apartments, with floor space ranging from 73 m² to 82 m².
Kop West, Purmerend – 74 apartments
Rental range: € 810 - € 1,145 per month
The Kop West apartment building is part of the Kop West area development (approx. 550 homes), west of the centre of the town of Purmerend, with amenities such as restaurants, cafes and shops just a stone’s throw away. Kop West includes 74 apartments with 72 parking spaces in the ground-floor parking garage. Offering living areas of 58 m² to 106 m² this project is suitable for both starters and senior citizens. Kop West is also potentially very interesting to the large number of Purmerend residents currently living in social housing but whose income is outside the target range for such homes.
Wickevoort, Cruquius – 100 family homes
Rental range: € 1,254 - € 1,281 per month
Landgoed Wickevoort is an area development of around 750 family homes in Cruquius, in the Haarlemmermeer municipality. Given the rural character of the development, there is a clear tie-in with the growing desire for sustainability and ecological awareness among (residential) consumers. This gives Wickevoort a very distinctive character compared with existing residential environments in the region. The project provides 100 family homes of 125 m² divided across two phases of 50 homes each, all with an EPC of 0.
Parc Valere, Helmond – 75 apartments
Rental range: € 800 - € 930 per month
Parc Valere is a development near the centre of Helmond, in which every apartment has its own storage and parking in a closed parking garage. There is a courtyard garden to the rear of the building. The location is easy accessible by both car and public transport and is within easy walking distance of the Combicentrum shopping centre. The project includes 13 different types of apartments, with floor space varying from 83 - 110 m².
De Werf (Building E), formerly known as Nautique Living, Amsterdam – 69 apartments
Rental range: € 800 - € 1,300 per month
The recently acquired E Building is part of a larger development consisting of seven connected apartment blocks, a two-level parking garage and an inner courtyard. The E Building includes 69 two- and three-room apartments in the liberalised rental sector, two commercial units and parking space. The E Building has an angular and robust concrete façade. The size of the apartments varies from 60 m² to 90 m² and all apartments have their own storage space. The attached central parking garage also includes a general bike storage area. The project is located in the former NDSM wharf area of the capital city, which is characterised by wide open spaces and its industrial look. The area is proven very popular with young urban dwellers. Although the area is still being developed, the influx of new residents is expected to lead to the addition of public facilities. Amsterdam Central Station is just a 15-minute bike/ boat ride away. Following the acquisition of the E and A Building (mentioned below) the Residential Fund now owns all seven buildings in this project.
Student Experience Nautique Living (De Werf, Building A), Amsterdam – 403 student apartments
Rent: approx. € 536, excluding services per month
This building includes 403 full service student apartments in the Government-regulated rental sector. The A building also offers a central shared space with reception desk, a library and study facilities, a launderette, bike storage and private garden. The size of the apartments varies from 25 m² to 40 m² and all are equipped with kitchenette and bathroom. This will be the third location in Amsterdam for specialised property manager Student Experience Beheer, who will manage it for the Residential Fund under the name Nautique Living.
Vrij Werkeren, Zwolle – 46 family homes
Rental range: € 950 - € 1,000 per month
Vrij Werkeren is a complex of 46 family homes in Zwolle’s Stadshagen neighbourhood. These are so-called NOM homes, which means the residents have no additional expenses for electricity and heating in their home if their energy consumption is in line with a pre-set norm. The Stadshagen neighbourhood is the largest in Zwolle and meets the demand for homes from the rapidly growing population. This complex also largely completes the design and realisation of the sub-neighbourhood Vrij Werkeren.
TT Vasum, Amsterdam – 304 apartments
Rental range: to be determined
This project is located only a few blocks away from De Werf and also located within the NDSM-area. Although the final program of TT Vasum is still subject to negotiation with the municipality, it currently includes approximately 304 apartments, a commercial space of approximately 500 m² as well as 124 parking spaces. The total development is shaped as two towers interconnected at the lower levels and also including a rooftop garden. The average apartment size will be approximately 55 m², which is slightly smaller than the apartments offered at De Werf.
Asset | City | No. of residential units | Expected rental level | Expected delivery date |
Het Nieuwe A | Arnhem | 48 | € 850 - € 950 | 2018 |
Saksen Weimarlaan | Arnhem | 28 | € 900 - € 950 | 2018 |
Landgoed Alverna Villa II | Aerdenhout | 36 | € 1,644 - € 2,126 | 2017 |
Hof Van Pampus | Hoofddorp | 74 | € 875 - € 1,033 | 2018 |
Kop West | Purmerend | 74 | € 810 - € 1,145 | 2018 |
Wickevoort | Cruquius | 100 | € 1,254 - € 1,281 | 2018 |
Parc Valere | Helmond | 75 | € 800 - € 930 | 2018 |
De Werf (Building E) | Amsterdam | 69 | € 800 - € 1,300 | 2018 |
Student Experience Nautique Living | Amsterdam | 403 | € 536 | 2017 |
Vrij Werkeren | Zwolle | 46 | € 950 - € 1,000 | 2018 |
TT Vasum | Amsterdam | 304 | to be determined | 2019 |
In some cases the number of family homes or apartments or the quality or lay out of acquired complexes changed. As a result the acquisition price changed accordingly.
Divestments
The decision to sell individual buildings is driven mainly by the returns they generate.
In 2016, the Fund sold 7 individual units in Venlo.
Optimising the risk-return profile
In 2016, active asset management of the current portfolio and acquisitions ensured further optimisation of the Fund’s risk-return profile. The Residential Fund has a well-balanced risk profile, with the focus on low-risk assets in the Fund’s core regions.
Portfolio composition by risk category based on market value
Portfolio diversification
At year-end 2016, the Fund’s total portfolio consisted of a total of 237 properties containing 15,329 residential units across the Netherlands.
The Fund aims for a balanced mix of family homes and apartments, catering for the needs of couples, single occupiers and families alike. In 2016, the Fund bought both family homes and apartments and sold a few family homes. Compared with 2015, the proportion of apartments in the total portfolio has increased at year-end 2016 (2016: 58.3%; 2015: 55.4%). Because we focus on inner-city areas, the proportion of apartments will continue to grow in the near future.
Portfolio composition by type of property based on market value
Portfolio composition by age
The Fund aims to constantly refresh the portfolio. As a result of this continuous rejuvenation, the weighted average age of the portfolio currently stands at 18.0 years (2015: 17.2 years). Despite the refreshment of our portfolio in 2016, the weighted average age of the portfolio stayed virtually the same compared to year-end 2015. Although we have increased our disposal target in the coming years, as a result of the ageing of the total portfolio, the weighted average age of the portfolio will increase in the future. Older assets that still generate good returns, are held in the portfolio and are kept up-to-date through refurbishments, including new bathrooms and/or kitchens, together with measures designed to increase energy efficiency and cut carbon emissions.
Age composition as a percentage of market value
Price level diversification
With an average monthly rent of € 1,001, the focus of the Fund continues to be on the mid-rental segment. Approximately 75% of the portfolio has a monthly rent of between € 711 and € 1,250. With the acquisition of 1,121 homes in 2016, mostly in the mid-rental segment, the Fund is well represented in a segment that is in high demand due to the current economic conditions. Individuals, couples and families who do not qualify for government-regulated rental housing are still finding it difficult to buy due to the sharp rise in house prices and the lack of affordable supply, especially in the Randstad. In addition, the rental market gives customers greater flexibility, which is becoming more important as people switch jobs more frequently than ever before. The Residential Fund’s continuing focus on the mid-rental segment has given it a solid portfolio of prime properties perfect for this target group.
Portfolio composition by price level based on rental income
Active asset management
Apart from the optimisation of the portfolio through acquisitions and divestments, we optimise the standing portfolio through active asset management. Our continuous aim is to decrease the number of houses in the government-regulated rental sector, especially with a rent under € 711. If possible this is done when a tenancy turnover is taking place. Furthermore, a high occupancy rate is one of our main targets. To maintain high occupancy rates, we devote a great deal of attention to the rental process.
One of the Residential Fund’s main goals is to respond to our tenants’ current and future needs and we believe the only way to do this is through a proactive exchange of ideas and opinions. We conduct numerous surveys and organise group discussions with tenants on a wide range of topics, ranging from mobility to environmental issues to explore ways to add value for our tenants and improve and future-proof our homes. The information provided by tenants on these and other issues gives the Residential Fund the input it needs to respond effectively to existing and future demands. Our in-house experts also monitor economic and demographic megatrends, such as ongoing urbanisation and the ageing of the population, enabling us to respond to these trends as effectively as possible, frequently in partnership with our tenants and future tenants.
The Fund is also constantly looking for new and effective ways to communicate with (potential) tenants and garner and use their feedback as effectively and early as possible in the development process for new developments. At the moment there is a pilot project with a mobile app for potential tenants.
The feedback that we received from our tenants revealed not only that people really appreciate how we chose to communicate with tenants and, very importantly, how we listened to them and used their opinions to make if possible positive changes. At the same time, the investments that we do as a result of this information, both sustain and increase the long-term value of our assets and equip them for the tenants needs of tomorrow.
One initiative Bouwinvest started is the ‘Ageing in place’ project, to address the fact that in the near future we will be dealing with increasing numbers of older tenants who may have care requirements. Research shows that 70% of elderly people prefer to spend their old age in their own, familiar home and surroundings. Reason enough then for Bouwinvest to join forces with its 65+ residents to assess whether existing homes comply with current (and future) wishes and requirements, so people can live longer in their current homes happily and safely.
We have learned that environmental concerns are top of mind for an increasing number of (potential) tenants. We also believe that making assets more sustainable helps us retain and increase the value of our properties, making this a win for all our stakeholders. In the last year Bouwinvest launched a couple of pilot projects for the likes of LED lighting in public areas, e-bike charging points and solar panels, all of which are proving both popular and successful.
As a result of active asset management and acquisitions, we increased the percentage of liberalised rental homes in the portfolio to 88.7% in 2016, from 87.4% in 2015.
Portfolio composition by type of rent based on rental contract
Focus on core regions
The Fund aims to achieve a balanced diversification, with a strong focus on core regions with a positive economic and demographic outlook. The target is to have at least 80% of the total value of the portfolio concentrated in residential real estate in these core regions.
Due to revaluations, together with acquisitions and divestments in 2016, over 92% of the portfolio value was located in these core regions, with by far the greatest part (84.3%) located in the core region of the Randstad urban conurbation.
Portfolio composition by core region based on market value
The Fund is constantly refining its long-term regional focus. This involves anticipating and responding to long-term trends that may affect the value of the portfolio, such as the growth of the number of households, the ageing population and steadily increasing urbanisation. The Fund’s core regions include the Randstad conurbation (Amsterdam, Rotterdam, The Hague and Utrecht), the Brabantstad conurbation (Breda, Eindhoven, Helmond, Den Bosch and Tilburg) and the eastern region (Arnhem, Apeldoorn, Nijmegen and Zwolle). These regions are expected to see the greatest population growth and largest increase in the number of households.
Active asset management combined with high-quality housing products at the best locations result in continuously high occupancy rates (97.7% average in 2016; 97.6% average in 2015).
Financial occupancy rate
