Analyzing Real Estate Options for BT Group in Amsterdam Zuidas

This report evaluates the real estate needs of BT Group for their business expansion in Amsterdam, focusing on the Zuidas Business District. It identifies critical factors influencing property purchase decisions, including demand & supply, space availability, lease terms, and rental levels. The research aims to provide insights into the Amsterdam marketplace, offering a rental advice plan considering the tax system and capital value. It explores the benefits and drawbacks of leasing versus purchasing, considering factors like property appraisals, long-term savings, and asset liquidity. The study aligns BT Group's business needs with the real estate market in Amsterdam, utilizing an inductive research approach and secondary data to understand the renting system and market trends. It concludes that aligning business needs with the Zuidas region makes renting a viable option, emphasizing the importance of understanding land limitations and financial stability before making any property decisions. Desklib offers a range of similar documents for students.

RESEARCH AND PROFESSIONAL PRACTICE
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Business expansion is important for surviving in competitive global marketplace (Shiller,
2013). This study has focused on evaluating the needs of BT group for space and
identification of critical factors that affect the purchase decision of property. Aim of this
research is to develop an understanding of needs to purchasing or taking lease of property
In addition, this study needs to inform the consumer of Amsterdam marketplace through
sharing information regarding demand & supply, availability of space, rates of take-up, lease
terms and terms of rental levels for existing buildings as well as design & develop.
Furthermore, it is important to give a rental advice plan to the client to understanding tax
system and value of capital.
In the literature review part, it has been mentioned that organizations think about expenses
during making decision regarding leasing or purchasing a property. However, purchasing
land depends on different factors like property appraisals, long term savings, and others. A
firm has less liability if a property was acquired through leasing or renting. Different aspects
require considering, during purchasing or leasing land, which includes commercial land
market, impact of tax and value of property. As opined by Biermanand Smidt (2007), one of
the main reasons to purchase commercial properties is value appreciation. Purchasing land or
other property saves an owner from paying monthly rents and other installments. Moreover, a
business generally uses 51% of commercial space on an average. Remaining space can be
rented that helps to improve return from investment. Different benefits of leasing property are
also described that includes high liquidity of assets (Zeller et al. 2015). During starting a
business additional stress in owning a property can be avoided by leasing. Moreover,
maintenance charges are also low that helps in improving operations of a business. As stated
by McGegor (2017), different aspects like nature of market, operations and business goals
need to be aligned for making purchase decision.
Aim of this research is to evaluate needs business through aligning this fact to Amsterdam's
real estate market. Research question has been set for achieving aims of this project.
Inductive research approach will be followed and secondary data regarding real estate
decision making in Amsterdam will be considered for this research. This methodology is
helpful to understand renting system of particular place (Daniel and Sam, 2011). Secondary
resources regarding market trends, selling & buying rate of property, availability of real
estate and potential challenges in purchasing or taking lease of property in Amsterdam.
In this study, need of client is 10000 sqm in Amsterdam Zuidas Business District. In addition,
they also need branding on outer part of the building, which is a part of company’s
commercial as well as business model. Moreover, this building must have the capacity to
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project corporate quality impression. Client wants 10 years lease on the building but an
option of break should be there at the end of the fifth year. Other requirements include
parking space and availability of public transport.
In this area, majority of land is owned by municipality; therefore land tax is high on property.
If a person buys a building then a lease needs to be signed regarding the ground. Rent for
office and ground rent is high in this area. Moreover, as stated by Savills (2019), in
Amsterdam rent rate is expected to rise in coming years. In southeast district of this area
availability of property will be high and it is a popular choice for commercial property. Rate
of small square take-up in Amsterdam is constant at 39.50. On another hand, maintenance for
energy cost is a factor in this region and rent ranges from € 350 to 450 per sqm. Moreover,
office supply has also diminished in this region by 17%. Energy conservation grade states
that quality of land in this region will increase in future. Presentation of the case is regarding
renting a commercial property in Zuidas for a business firm. Presence of energy conservation
model and tailored allocation of resources can help this organization to gain growth
opportunities. Supply of renting is low art present market, which can be mitigated through the
help of proper connection. This, in turn, can help the business by creating more growth
opportunities.
Before analyzing success rate of commercial property venture, it is essential to gain
knowledge regarding various limitations of a land. Proper understanding regarding business
aims and financial stability of a firm need to be assessed before making any purchase or lease
decisions. In this case, it can be seen that different business needs of BT group have been
aligned with Zuidas region and process of renting can be done.
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Reference list
Bierman, R and Smidt, S. 2007. The Capital Budgeting Decision: Economic Analysis of
Investment Projects, 9th ed., Routledge, New York, N.Y.
Daniel, P and Sam, A. 2011. Research Methodology. Routledge
McGregor. 2017.Routledge Companion to Real Estate Investment.Routledge
Savilis .2019.Six trends for commercial real estate investment in Europe in 2019. Savilis.pvt
Shiller, R.J. 2013. Finance and the Good Society, Princeton University Press, Princeton, NJ,
p. 312
Zeller, T., Stanko, B and Tressler, A. 2015.How Risky Are Your Lease vs. Buy Decisions.
IMA. Available at:
https://www.imanet.org/-/media/1e8d72234c7c4b5db300f4f2b32b44f6.ashx
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