Ongoing decline in the market
The crisis has left deep scars in the Dutch property market. The new economic recession combined with stricter European oversight of financial institutions and hesitation on the part of investors resulted in a fall in property investments and exacerbated the problems in the property market. The market for new-builds virtually ground to a halt and the commercial real estate market faced high vacancy rates of existing properties. Demand for property investment funds was limited. The fair market value of strategic land positions and land operations, properties and the financing portfolio in the statement of financial position of Rabo Real Estate Group came under stress as a result of the crisis. In addition, the market was plagued by budget cuts announced by the Dutch government, a decline in purchasing power and an extremely low level of consumer confidence. There are some positives too: high-quality real estate is keeping its value and the Cabinet measures will eventually result in reform of the Dutch housing market. In the near future, however, the measures may well have the opposite effect and cause the housing market to fall even deeper into depression. Rabo Real Estate Group is acutely aware of the opportunities and threats. Risks are mitigated thanks to the spread of the real estate operations across the Netherlands, France and Germany.