Market spotlight

Trends and prospects

What are the current trends in and future prospects for the real estate market (both commercial and residential) in your jurisdiction?

Last year saw record investment in Dutch real estate, exceeding that of 2007. Investors are mainly interested in office buildings and residential real estate. We have also seen increased activity in the field of corporate real estate. The investment volume in retail properties was lower than the preceding year, probably due to the bankruptcy of several retail chains and continuing uncertainty in this part of the market. In retail, the average rental prices have also been dropping.

Due to the declining supply of good quality assets, investors have been forced to look outside Amsterdam with increased levels of interest in Rotterdam and Utrecht. There is plenty of money and financing available and the real estate market still benefits from low interest rates.

The prospects for 2017 remain positive with a high volume of real estate transactions, comprising both single asset and large real estate deals, also supported by increased investments in retail. Compared to other European countries, the yields in prime real estate remain attractive.

Rights and registration


What types of holding right over real estate are acknowledged by law in your jurisdiction?

Ownership, leasehold, right of superficies, the right of usufruct and apartment rights are all recognised. The contractual rights of rent and lease also give entitlement to real estate holdings.

Are rights to land and buildings on the land legally separable?

Yes, under Dutch law it is possible to prevent accession by creating a right of superficies, which gives ownership rights to a certain building (or part thereof).

Which parties may hold and exercise rights over real estate? Are there restrictions on foreign ownership of property?

Both individuals and legal entities may hold and exercise rights over real estate. In general, there are no restrictions on foreign ownership of property.

How are rights, encumbrances and other interests over real estate prioritised?

Dutch law has a closed system of rights in rem, which are prioritised by the prior tempore rule: an older right has priority over a younger right. A successor in title will only be confronted with any existing rights in rem, attachments and qualitative obligations.

A successor in title is – in principle – not bound to the contractual obligations of its predecessor as these relate to the property, unless such an obligation is explicitly imposed on it. An example of this is a perpetual clause, which is regularly used in the Netherlands. Another example is that contractual rights are – in principle – not prioritised due to the Dutch principle of equality of creditors.


Must real estate rights, interests and transactions be registered in your jurisdiction? What are the legal effects of registration?

Registration in public registers is an essential formality for certain legal acts relating to Dutch real estate. For example, it applies in the event of:

  • a transfer and encumbrance of ownership of real estate;
  • the establishment, encumbrance and transfer of rights in rem; and
  • the conclusion of qualitative obligations.

The public registers have a negative system, while the Land Registry plays a relatively passive role, which means that there is a possibility that information available on the registry and contained in the public registers could be inaccurate or incomplete. In this regard, Dutch law contains several provisions which provide protection against the incompleteness or inaccuracy of information available via the Land Registry or contained in the public registers.

What are the procedural and documentary requirements for entry into the national real estate register(s)? Can registration be completed electronically?

In real estate transactions, registration will be handled by the civil law notary involved who can also complete the registration electronically. If the required information is received before 3.00pm, the deed will be registered as of that date. Information available via the Land Register is updated every business day.

What information is recorded in the national real estate register(s) and to what extent is such information publicly available?

The public registers for real estate are held at the Land Registry. This information is publicly available to anyone upon payment of a small fee. Information can be obtained via the Land Registry website and delivered by email within a few minutes of the initial request. The public registers contain true copies of (notarial) deeds registered with the Land Registry.

The Land Registry carries the names of the owner, holders of rights in rem, attachments and rights of mortgage and mentions qualitative obligations and restrictions under public law, including references to the relevant (notarial) deeds. Further, it shows the address, area and coordinates. 

Is there a state guarantee of title?


Sale and purchase


How are real estate brokers regulated in your jurisdiction (eg, through caps on commission or disclosure obligations)?

There is no special regulation for real estate brokers. They do not have a protected title, which means that anyone can start work as a real estate agent. Nonetheless, most real estate agents will be a member of an association of real estate brokers and/or professionals, such as NVM or RICS. These associations provide self-regulation for their members.

Due diligence

What due diligence should be conducted before conclusion of a real estate sale contract?

Under Dutch law, the seller is obliged to disclose certain matters to the buyer, but the buyer also has an obligation to investigate; therefore, due diligence is required before the conclusion of any real estate sale contract. These investigations will usually include the following topics:

  • title;
  • lease;
  • commercial contracts;
  • litigation;
  • zoning;
  • environment; and
  • permits.

Further, a technical adviser is often requested to perform a technical due diligence to assess the state of repair and presence of asbestos and soil contamination.

Preliminary agreements

Are any preliminary agreements typically entered into before conclusion of a sale contract?

Yes. In commercial real estate transactions, a letter of intent, heads of terms or a memorandum of understanding is often signed at an early stage of the sale process. Such a document will normally outline the main terms of the envisaged sale, the sale process and exclusivity granted for a certain period. It will also stipulate that the parties will be bound only by a signed written sale contract.


Must sale contracts be concluded in writing? If so, must they be notarised?

A sale contract between an individual, who is not acting in the course of his or her business or profession as purchaser, and a third party as seller regarding a residential property must be concluded in writing. In such a case, the absence of a written contract can be invoked by either side, unless the seller is also an individual who is not acting in the course of his or her business or profession.

A sale contract can also be concluded verbally where it:

  • is between a purchaser as a legal entity or an individual acting in the course of his or her business or profession and any third party; 
  • is between two professional parties; or
  • does not concern a residential property.

Nonetheless, we would always advise laying down an agreement in a written contract.

Notarisation is not necessary to conclude a sale contract.

Can sale contracts be concluded electronically?

Except for the requirement mentioned above, the law does not prescribe a particular form for the conclusion of sale contracts involving real estate.

What provisions are usually included in a sale contract?

The following are usually included in a sales contract:

  • purchase price and payment thereof, including a deposit of 10% of the purchase price;
  • appointment of the notary and allocation of the costs of delivery;
  • tax clauses (eg, with regard to value added tax (VAT) and real estate transfer tax);
  • settlement of certain costs, expenses and rent payments;
  • date of delivery, description of transfer obligations and choice of the date of the transfer of risk, income and expenditures (usually occurs on the date of delivery);
  • representations and warranties;
  • information and due diligence clauses, often including a limitation of liability for the seller;
  • conditions subsequent and conditions precedent – a sales contract is always subject to the provision that no government body makes use of the Municipalities (Preferential Rights) Act, as well as to sufficient financing being arranged;
  • a clause regarding the devolution of the property and the assignment of insurance claims;
  • a default clause setting out the payment of damages and penalties;
  • several boilerplate clauses (eg, transferability of rights, recession, whole agreement, governing law, dispute resolution); and
  • in the event of a purchase of a residential property by an individual not acting in the course of his or her business or profession, the date on which the three-day cooling-off period expires.

Obligations and liabilities

What are the seller’s disclosure obligations and other liabilities, and what are the consequences of breach?

This will depend on the content of the sale agreement. Usually the seller will guarantee certain qualities of the real estate or a certain use of the property. In such a case, the justified expectations of the purchase will be based on all relevant circumstances, including:

  • the nature of the property; and
  • the information disclosed by the seller.

However, the seller does not need to provide facts known to the purchaser or information relating to facts known by the purchaser which should give rise to further investigation.

Other liabilities will depend on the agreed transfer obligations and other specific representations and warranties provided by the seller.

A breach by the seller could lead to damages and penalties becoming due or even a (partial) rescission of the sale contract.

What contractual warranties are usually given by the seller?

This depends on the agreement between the seller and the purchaser. A sale and purchase agreement with full representations and warranties will differ from one concluded on an as-is basis. ‘As is where is’ is often interpreted in different ways by sellers and purchasers and is not a defined term in the Dutch market. The following are often provided:

  • title warranties:
    • stating that the seller will be authorised to transfer the property at issue;
    • regarding the absence of rights in rem, mortgages, attachments, easements, qualitative obligations, perpetual clauses and similar rights; and
    • in case of leasehold or superficies, stating that the annual ground rent has been paid or has been bought off (for a certain period), that this right has not been terminated by the owner and that there are no circumstances which may result in the termination of the leasehold or superficies;
  • warranties regarding the lease (if applicable):
    • stating that the property is let for a certain period and against a certain sum, also giving details of any incentives (if any) granted to the lessee;
    • stating that there are no arrears, that the rent has not been prepaid for more than six months and that no rent proceeds have been pledged or attached; and
    • stating that the seller has fulfilled its obligations under the lease agreement(s);
  • warranties regarding the features and condition of the property, stating that:
    • certain public law aspects do not apply, such as the property being listed as a monument, that no enforcement decisions have been taken or government subsidies have been applied for or granted with conditions that still need to be complied with, that the property is not included in an urban or village renewal plan and that there are no other public law restrictions;
    • the property is in a good state of repair, that all technical installations function properly and that the property is connected to public water, sewerage and electricity;
    • there are no hire purchase agreements, options or preferential rights regarding the property; and
    • the property will not be subject to any claim, will be vacant (if applicable) and not used by any third parties without right or title on the delivery date;
  • warranties and representations regarding environment, permits and zoning stating that:
    • the property is built, refurbished and used in compliance with the applicable environmental permits and zoning plan;
    • the seller is not aware of the presence of soil contamination, asbestos or any other hazardous substances and representations about the presence of any oil or sceptic tanks; and
    • the seller is not aware of any plans for expropriation, that there are no obligations to offer the property for sale to the municipality, province or state of the Netherlands on the basis of the Municipalities (Preferential Rights) Act, and that the seller is not aware of any plans to designate the area in which the property is located as an urban renewal area; and
  • a warranty regarding information that the seller will represent that it has provided the purchaser with all information that it should disclose, with the exception of any information known to the purchaser or which should be known to the purchaser based on its own investigation of the property, insofar as such investigation should be performed by the purchaser accordingly.

Are there any other obligations on the buyer, aside from paying the purchase price?

Usually a 10% deposit needs to be paid or a bank guarantee provided after the conclusion of the sale contract. If the contract is subject to sufficient financing being arranged, the deposit or bank guarantee will be provided within a few days after the period for arranging such financing has lapsed without the purchaser invoking its right to rescind the sale contract on the grounds that sufficient financing could not be arranged.

The buyer will pay for the taxes and costs of delivery of the property.


What taxes are payable on the sale and purchase of real estate? Are any exemptions available?

The transfer of real estate, beneficial ownership of real estate and interest in real estate companies is subject to real estate transfer tax. The tariff for residential property is 2%, while the tariff for all other properties is 6% over the higher of the fair market value or the consideration. In case of ground leases or rights of superficies the taxable base is increased, with the net present value of the ground rent to be calculated based on provisions in the relevant tax law.

If the property concerns building land, an unbuilt-on parcel which is designated for development or a new building which is transferred before or within two years after the moment it is first taken into use, VAT at 21% will apply to the transfer of such property by operation of law. VAT will also apply if the parties opt voluntarily for a transfer subject to VAT. For instance, if a VAT adjustment period still applies to a property, the seller will often demand for a delivery subject to VAT.

The real estate transfer tax act contains a list of exemptions, which are available in the event of the following:

  • the transfer of a property which is subject to VAT;
  • business succession by family members;
  • the conversion of a one-man business or partnership into a legal entity and vice versa;
  • mergers, demergers and the internal reorganisation of a group of companies;
  • the transfer of cultivated land to be used for farming and nature grounds; or
  • the transfer of registered networks.

Further, in the case of a transfer of the same property within a period of six months, the taxable base used to calculate real estate transfer tax will be lowered to an amount equal to the taxable base that was used in respect of the previous transfer of the property. 

Transfer of title

When does title in the property transfer?

The transfer of real estate requires:

  • a valid title for transfer;
  • the power of disposition by the seller; and
  • transfer of the property, consisting of a Dutch notarial deed executed between the parties and the registration of this in the Dutch public registers. 


What is the typical duration of a sale transaction?

Between six and eight weeks.



Must a lease agreement be concluded in writing?

A lease may be concluded orally or in writing, and may even be deduced from the circumstances at hand. Accordingly, the fact that there is no signed lease agreement does not imply that there is no lease. Any situation in which one party allows the use of its property and the other party pays a consideration for that use is deemed to constitute a lease agreement. Clearly, written agreements are advisable to constitute evidence of the agreement between the parties.

Are there any regulations setting out mandatory or prohibited provisions in lease agreements?

Dutch lease legislation distinguishes between different types of property leases. These include:

  • private housing (or residential) leases;
  • retail leases (eg, leases for commercial space including retail, hotels and restaurants); and
  • other commercial space (eg, office space or industrial space such as a warehouse or factory).

Lease agreements are governed by Sections 7:201 to 7:310 of the Dutch Civil Code. The applicable mandatory regime differs for each type of lease. Many of the sections are provisions of directory law, which allow for contractual deviation. However, the code also contains mandatory and semi-mandatory provisions, especially for the lease of private housing and, to some extent, retail space (eg, in relation to termination and rent review). 

What provisions are typically included in lease agreements?

Provisions that are typically included in lease agreements include:

  • permitted use;
  • the term of the lease;
  • extension and termination;
  • amount of rent;
  • applicability of value added tax;
  • revision of rent;
  • service costs;
  • security; and
  • environment.

In addition, there may be clauses reflecting more specific agreements between parties (eg, maintenance and sub-leasing).

Moreover, the Dutch Council for Real Estate’s general terms and conditions (as mentioned below) provide comprehensive provisions on:

  • the condition of the property;
  • responsibilities in relation to government regulations and permits;
  • usage;
  • sub-leasing;
  • environment;
  • promotional activities (regarding retail);
  • rules of conduct;
  • damages;
  • liability;
  • maintenance;
  • repair and renewal;
  • changes and additions;
  • changes to the organisation of the landlord/tenant;
  • valuation and viewing;
  • indexation and rent review;
  • service charges;
  • taxes;
  • insurance;
  • termination;
  • payments;
  • remedies for non-payment; and
  • securities.

What are the standard forms of lease agreement used in your jurisdiction?

The intended primary use of the real estate (ie, residential, office or retail) usually determines the applicable category of the lease agreement. Standard form lease agreements and general conditions applicable thereto, prepared by the Council for Real Estate, are frequently used in all three categories and are considered the market standard.

Length of term

Are there any regulations on minimum and maximum terms of leases?

Leases for commercial real estate can be entered into for either a fixed or an indefinite period.

Leases for residential space can be entered into for either a fixed or an indefinite period. However, even in case of a fixed period the tenant can claim protection and the lease cannot be terminated.

For office space, parties are free to decide on the lease term. A term of between five and 10 years is common, with often one or two renewal periods.

For retail space, subject to mandatory provisions the initial lease term is five years, with an automatic extension upon the expiry of this of up to 10 years. Leases agreed for less than two years (which then end) are not subject to the mandatory regime for retail space.

Under Dutch general lease law, if the tenant remains in the possession of the leased premises upon the expiry of the fixed term of the lease and with the landlord’s permission, the lease agreement will be extended indefinitely.

Are long-term tenants accorded any special rights as to extension or renewal of leases?

No, unless this has been agreed in the lease agreement.


What regulations (if any) govern rent increases?

Office space

Parties are free to agree the amount of rent – this is not regulated by Dutch law. That means that parties can also agree to an indexation scheme and a rent review mechanism. If no such provision is included in the lease agreement or part of any other additional agreements between the parties, a rent review will not be possible.

Retail space The parties are free to agree on the amount and indexation of the rent. If the current rent amount does not correspond with the rent of comparable leased properties in the area, each party may periodically request a court to determine the rent at the end of a lease term or every five years. Before the parties address the court on this issue, they must appoint an expert evaluator, who will advise the court. If the parties fail to reach an understanding on the appointment of an expert, the court will appoint one. The new rent will be determined on the basis of the actual rents paid for comparable leased properties in the area during the past five years.

Residential space There is a distinction between regulated and non-regulated residential space. Rent increases in regulated residential space are capped at the level set by the government. With regard to non-regulated residential space, rent increases are typically index linked (often to the consumer price index published by the Central Bureau for Statistics in the Netherlands).

What regulations (if any) govern rent security deposits?

None, although security in the form of a bank guarantee or deposit amounting to three months’ rent is common.

Can the tenant withhold rent payments on any legal grounds?

This may be possible in limited circumstances for any breach by the landlord of its obligations under the lease agreement. However, the Council for Real Estate’s general terms and conditions prohibit suspension, reduction, deduction or set-off against any claim the tenant has or believes it has against the landlord.


Under what circumstances is sub-letting typically allowed?

Sub-letting by the tenant of the leased premises in whole or in part is permitted unless it has reason to believe that the landlord has reasonable objections to this. This is mandatory law, so parties may deviate contractually. The Council for Real Estate’s general terms and conditions stipulate that sub-leasing is subject to the landlord’s prior permission. However, as the principles of reasonableness and fairness of Dutch contract law apply in such situations, the landlord generally cannot withhold its permission for sub-leasing, especially if the sub-tenant is creditworthy and has standing equivalent to that of the tenant.

Obligations and liabilities

What are the general obligations and liabilities of the landlord in respect of the property and what are the consequences of breach?

The landlord’s main obligation is to put the leased premises at the disposal of the tenant to the extent necessary for the agreed use.

The landlord must repair defects to the leased premises upon the tenant’s request, although it is not obliged to repair minor damages which by law must be accounted for by the tenant or defects which are attributable to the tenant.

If the landlord defaults on its obligation to repair the defect, the tenant may repair the defect itself and request that costs be reimbursed. The tenant may offset these costs against the rent payable. Further, the tenant may request a decrease of the rent equal to the decrease of the enjoyment of the leased premises caused by a defect attributable to the landlord.

The landlord is liable for any damages that result from a defect in the leased premises, provided that:

  • the defect occurred after the commencement of the lease and is attributable to the landlord;
  • the defect existed at the beginning of the lease and the landlord was aware or should have been aware of it; or
  • the landlord stated at the beginning of the lease that the defect did not exist.

This clause is mandatory with regard to the second provision listed above.

What are the general obligations and liabilities of the tenant in respect of the property and what are the consequences of breach?

The main obligation of the tenant is to pay the rent in the manner prescribed and at the time agreed. If it fails to do this, the landlord is entitled to statutory interest. In most cases the lease agreement includes a penalty clause. This penalty will be due instead of the statutory interest, unless otherwise agreed.

Alterations The tenant may make alterations to the leased premises only with the permission of the landlord. Permission is not required for alterations or changes that can be removed or restored at the end of the lease without substantial costs.

If the landlord refuses to grant permission, the tenant can ask for the court's permission for the proposed alterations. The court will grant permission for alterations which are necessary for an effective use of the leased premises by the tenant and where no substantial interest of the landlord is violated.

The tenant is entitled but not obliged to remove the permitted alterations at the termination of the lease. The tenant may request a reimbursement for the costs of the alterations if the landlord is unjustly enriched by these alterations. This clause is directory law and may therefore be excluded by contract. Accordingly, the Council for Real Estate’s general terms and conditions exclude the right of the tenant to claim damages based on unjust enrichment.

Maintenance or renovation The tenant must cooperate with the execution of urgent maintenance or (in some cases) renovation works to the leased premises. The landlord must still provide quiet enjoyment to the tenant as started under the lease, as the tenant may claim a reduction of the rent in case of maintenance works or a renovation.

Reinstatement obligation Upon termination of the lease, the tenant must generally deliver the leased premises back to the landlord in the original state, as set out in a description which was drawn up at the commencement of the lease. If no such description was drawn up, the tenant must reinstate the leased premises in a good and orderly state, clean and entirely vacated. Parties may also agree that the leased premises can be re-delivered to the landlord as is.

Damages to leased premises The tenant must report damages and defects to the leased premises to the landlord immediately. If it fails to do so, depending on the circumstances, it will not be entitled to claim damages and will be liable for damages resulting from its negligence.


Are any taxes payable on rental income? If so, are any exemptions available?

In principle, the lease of immovable property is not subject to value added tax (VAT) in the Netherlands. However, parties may, and will often, choose to charge VAT on rent as this may be beneficial to both parties. This is only allowed when at least 90% of the activities undertaken in the leased premises are subject to VAT.


Are the landlord and tenant bound by any insurance requirements?

No. The Council for Real Estate’s general terms and conditions stipulate that any excess of insurance payments due above the normal premium because of the nature or characteristics of the trade or profession carried out by the tenant must be reimbursed by it.

Termination and eviction

What rules and procedures govern termination of the lease by the landlord and the tenant’s eviction from the property?


If a lease agreement is entered into for a fixed period of time, neither party can terminate the lease prematurely, unless by mutual consent. Termination of the lease based on a default of the tenant is only possible by court order.

If a lease agreement is entered into for an indefinite period of time both parties may terminate the lease at any given time, with due observance of the applicable notice period.

If the tenant goes into bankruptcy, both the landlord and the receiver/administrator can terminate the lease agreement prematurely with a notification period of three months.

For retail space, a specific regime applies. When the tenant gives notice of termination of the lease agreement at the expiry date of a lease period, the lease agreement will end automatically. However, if the landlord gives notice of termination, the lease agreement will continue until the competent court has terminated it (unless the tenant agrees to termination). There are limited statutory grounds available to the landlord for terminating a lease. The notification period must be at least one year. Where the court allows the claim, it shall also set a vacation date.

Eviction (protection) – applicable only to other commercial space (eg, office space or industrial space such as a warehouse or factory) With regard to an office lease the only mandatory regulation concerns the end of the lease.

The lease agreement terminates by expiry of the term or, if no term has been agreed, by termination of one of the parties. In order to oblige the tenant to vacate the leased premises, the landlord must give a notice of eviction. The obligation to evict is subsequently suspended for two months by law as of the date of eviction stated in the notice of eviction. (A tenant is not entitled to a suspension of eviction if it has given notice of termination of its own accord or if it has expressly agreed to termination.)

Within the two-month period the tenant may request the courts to extend the suspension term. By filing this request, the obligation to evict is further suspended after the expiry of the two-month period until a judgment has been handed down by the competent courts. The courts can extend the suspension term by up to one year and the tenant may repeat this request for extensions twice more. The suspension term can therefore be extended by up to three years.

A request to extend the suspension term is judged by a weighing of interests: the interests of the tenant in an extension of the eviction period versus the interests of the landlord in an immediate eviction. In any case a request for extension will be denied if the landlord can show that an extension would be unacceptable in view of misconduct by the tenant.


Finance providers

What are the typical providers of real estate financing in your jurisdiction? Are there any restrictions on who may provide financing?

Real estate financing in the Netherlands is provided by Dutch and foreign banks, insurance companies, pension funds, private equity and hedge funds.

Activities in the field of real estate financing are regulated by De Nederlandsche Bank NV and the Netherlands Authority for the Financial Markets.

Financing structures

What are the most common structures used to secure real estate financing and how are these security interests perfected?

Generally you see the following securities in real estate financings:

  • A mortgage over the property/real estate (including movable assets), which is taken by way of a notarial deed and executed before a notary. Mortgages must be registered with the Land Registry.
  • A pledge of shares in the property companies and, if applicable, the holding companies. This security is taken by way of a notarial deed and executed by or before a notary. No registrations or notifications are required.
  • A pledge over bank accounts (eg, rental income accounts, general accounts or Opex accounts) and rights (eg, leases, intercompany loans or management agreements). This security is usually a private disclosed deed, which means that the banks and other relevant counterparties should be notified. This deed may also be registered with the Dutch tax authorities (which involves no registration costs).

What covenants are typically made in financing agreements?

In real estate financing, the following financial covenants are regularly included:

  • loan to value;
  • debt service cover ratio; and
  • interest cover ratio.

Enforcement of security

How are security interests enforced in the event of default?

Pledge and mortgage rights are enforced through a sale by public auction, although some exceptions are possible:

  • in case of enforcement of a right of mortgage, the property can also be sold by a private treaty, provided that this is approved by the court in preliminary relief proceedings after a request for these from the mortgagor or mortgagee;
  • in case of enforcement of a right of pledge, the sale can also be concluded other than by a public auction, at the request of the pledgor or pledgee and after approval by the court in preliminary relief proceedings, unless the deed of pledge stipulates otherwise;
  • in case of enforcement of a right of pledge, the pledgee can also request the court in preliminary relief proceedings that the pledgee will acquire the encumbered property against a sum to be determined by such court; and
  • in case of enforcement of a right of pledge, the pledgor and pledgee can agree to conclude the sale other than via a public auction after the pledger has become entitled to enforce its rights under the right of pledge.

What is the typical timeframe for the enforcement of security?

Between 10 and 12 weeks.


Investment climate

What is the general climate of real estate investment in your jurisdiction?

The general climate remains favourable, with a high volume of real estate transactions consisting of single asset deals and large real estate transactions, also supported by increased investments in retail. Compared to other European countries, the yields in prime Dutch real estate are attractive.


Who are the most common investors in real estate?

The most common investors are investment funds and institutional investors, privately held property companies and investors, private equity and listed companies and real estate investment trusts.

A substantial number of investors are based in the Netherlands or other European countries (currently about 50% of new investments). Other investors are based in the United Kingdom and the United States, while recent figures show an increasing number of investors coming from the Middle East and Asia-Pacific.

Are there any restrictions on foreign investment in real estate?


Investment structures

What structures are typically used to invest in real estate and what are the advantages and disadvantages of each (including tax implications)?

Limited partnerships are often used, because they are transparent entities for tax purposes. The structure of a Dutch property company and a Luxembourg holding company is also used due to favourable tax treaties. We also notice that a separate property company is sometimes set up for each property so that it is possible to sell shares in the company instead of the property itself. Further, we have also come across joint venture real estate companies with shareholders that each hold less than one-third of the shares.

Planning and environmental issues


Which government authorities regulate planning and zoning for real estate development and use in your jurisdiction and what is the extent of their powers?

Under the Spatial Planning Act all municipalities are required to adopt one or more zoning plans for municipal grounds and to update these every 10 years. A zoning plan is formally adopted by the municipal council; this designates the allowed use of land and imposes restrictions on buildings thereon, with regard to height and other dimensions. The municipal council has a great deal of discretion when it comes to designating the allowed use of land. The administrative judge only marginally assesses whether the choices made by the municipal council in a zoning plan are reasonable and in line with sound spatial planning. In case of overriding regional or national interests, a regional zoning plan or a national zoning plan may be adopted by the provincial council or the minister of infrastructure and the environment, respectively.

What are the eligibility, procedural and documentary requirements to obtain planning permission?

Developing real estate must be allowed for under the applicable zoning plan. If the zoning plan does not permit the planned activities, the development requires a zoning plan amendment or an integrated environmental permit for deviating from the zoning plan under the Environmental Protection Act. The development must be in line with sound spatial planning. Various other permissions may be required, such as permission for building. This also depends on the scope of the planned activities and their impact on the environment. For instance, if the activities may negatively affect protected species in a designated Nature 2000 area, the activities would also require a permit under the Nature Protection Act. In general, a permit application must contain sufficient information to enable the competent authority to assess whether all requirements have been met for granting the required permission. If a permit application does not contain sufficient information, the competent authority must request additional information before considering the application.

Can planning decisions be appealed? If so, what is the appeal procedure?

While planning decisions can be appealed they are first subject to reviews or objections. An extended preparation procedure applies to the adoption of a zoning plan. Part of this involves the publication of a draft version of the decision. Following the publication of the draft decision, interested parties have six weeks to submit views. The municipal council must take all submitted views into account when adopting the zoning plan. Any appeal against a zoning plan must be lodged with the Council of State within six weeks. The council’s judgment on the adopted zoning plan is final. Other planning decisions will, in principle, be adopted in accordance with the regular preparation procedure and are, accordingly, subject to objections before the competent authority first. The competent authority’s decision on the objections may be appealed to the district court within six weeks. A higher appeal against the district court's judgment can be lodged with the Council of State within six weeks.

What are the consequences of failure to comply with planning decisions or regulations?

Not complying with planning decisions or regulations constitutes a violation of said decisions and regulations and is thus prohibited. Such a violation may result in enforcement action by the competent authority, either ex officio or upon the request of an interested party. Under well-established case law from the Council of State, a competent authority is obliged to take enforcement action against a violation. Only in exceptional circumstances (ie, when enforcement action would clearly have unreasonable consequences or when legalisation is imminent) may a competent authority decide not to take enforcement action. In general, enforcement action by a competent authority will take the form of a penalty order or administrative coercion. However, a violation may also constitute a criminal offence and may therefore also be criminally prosecuted, although this is not common in spatial planning matters.

What regime governs the protection and development of historic and cultural buildings?

The regime which governs the protection and development of historic and cultural heritage is set out in the Heritage Act, which entered into force on July 1 2016. Among other things this establishes a certification system for carrying out excavations. This certificate must be issued by a certifying institution, which assesses whether the party is suitable for carrying out the excavation activities. The act also contains more general provisions regarding the preservation of historic and cultural heritage. In addition, particularly with respect to historic and cultural buildings, the Environmental Protection Act establishes that demolishing, changing or disturbing a designated monument requires an integrated environmental permit. In principle, the regular procedure applies to the granting of such permit, but if the activities are of a severe nature, the extended preparation procedure may apply instead.

Government expropriation

What regime applies to government expropriation of real estate?

The regime established by the Expropriation Act applies to the expropriation of real estate and comprises two phases. The first phase consists of an administrative expropriation procedure which must be followed by the government. According to this, a government body (eg, a municipality) will submit a request to the crown (on the recommendation of the minister of infrastructural works and the environment) to designate an area for expropriation. Interested parties may file legal proceedings against the designation. In the second phase, once the area for expropriation has been designated, the government can initiate a civil expropriation procedure before a civil court. The court will determine the amount of compensation payable to the owner of the expropriated area in this procedure.

What is the required notice period for expropriation and how is compensation calculated?

Many terms and periods apply in an expropriation procedure, which can be lengthy. The government will approach the land owner to discuss a sale of the real estate first without initiating a formal expropriation procedure.

The compensation method set out in the Expropriation Act aims to compensate for all damages which occur as a direct and necessary result of the expropriation. These may consist of financial losses such as the value of the real estate, compensation for annual losses such as loss of income and also one-off costs such as relocation expenses.

Environmental issues

What environmental certifications are required for the development of real estate and how are they obtained?

Many permits and approvals may be required for the development of real estate, including the following:

  • An environmental permit for building activities – this will have to be applied for with the municipality before building activities may commence. If the facility has a severe impact on the environment, it will be necessary to obtain an integrated environmental operating permit.
  • An environmental notification under environmental law for operating a ‘facility’ under the Activities Decree – this must be submitted to the municipality four weeks before the real estate is constructed.
  • A fire safety notification or permit – this may have to be applied for with the municipality in consultation with the local fire department and will contain restrictions in the interests of fire safety.
  • Other permits may be required as well, such as a water permit for operating a thermal storage system and a Nature Protection Act permit for any impact on protected species and local permits. 

What environmental disclosure obligations apply to real estate sales?

There is no specific rule on disclosure of environmental information in real estate sales transactions. However, under the Civil Code the seller must disclose information – including information that it should know that may be relevant to the buyer – while the buyer is also obliged to make its own due investigations. Although this depends on the merits of the case (including on the professionalism of the parties involved and what information is already available in the public domain, such as soil contamination registered in the Land Register), typically the seller’s disclosure requirement will prevail over the buyer’s duty to investigate. The seller is thus likely to be liable for any failure to disclose information which was not self-evident to the buyer. In transactions, it is common for the buyer to require warranties and indemnities for environmental matters from the seller. Usually, this is in itself a driver for the seller to disclose information. Environmental items which are quite often discussed in a transaction are the presence of asbestos and soil contamination.

What rules and procedures govern environmental clean-up of property? Which parties are responsible for clean-up and what is the extent of their liability?

The polluter is primarily responsible for the contamination of property. If the polluter no longer exists or is not creditworthy, the land owner or leaseholder could, under certain circumstances, be held responsible, regardless of whether they contributed to the contamination. However, the authorities have the discretion to decide whether to assign responsibility for remediation to either the polluter or the land owner.

Are there any regulations or incentive schemes in place to promote energy efficiency and emissions reductions in buildings?

Several laws and other initiatives are in place aimed at reducing greenhouse gas emissions and improving energy efficiency. Most noteworthy are:

  • the National Energy Agreement for Sustainable Growth between the Dutch government and several civil parties; and
  • the Dutch implementation of the EU Energy Efficiency Directive (2012/27/EU) which requires companies to conduct energy audits every four years in order to identify energy-saving measures which could lead to lower energy consumption by their businesses. In addition, all energy-saving measures with a payback period of five years or less must be undertaken.

An amendment of the Building Decree 2012, aimed at improving energy efficiency in office buildings, is due to come into force in the first half of 2017. The amendment introduces an obligation to upgrade office buildings so that these will (at a minimum) meet C-Energy label requirements. The upgrades should be completed before January 1 2023.