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Utrecht, a favorable climate for investors

Located near the country’s geographic center, Utrecht is the fourth largest city in the Netherlands in terms of population. Its economy is driven by academics mostly due to its world-class universities and research institutions. The region of Utrecht offers easy access to Europe and a favorable climate for startup companies.

Located at the heart of the Netherlands, 48 km from Amsterdam, Utrecht lies at a crossroads. Built around the 112-meter-high Dom tower (built in the 13th century with its 465 steps) it is one of the Netherlands’ oldest cities and offers a medieval center small enough to walk around easily. In 2009, this city had nearly 300,000 inhabitants; in 2015 they were over 334,000 (including about 70,000 students). The population is expected to reach 390,220 by 2030. Students are attracted by its world-class universities according to the 2014 Shanghai ranking. Utrecht Science Park welcomes different institutions among which the University Medical Center; 21,000 people work within this park. Utrecht remains a young city with 31% of its population aged between 27 and 44 and 60% of its labor force is highly educated. The largest economic sectors are healthcare, trade and business services such as consultancy and engineering. The trade sector is the biggest employer (18% of employment) in the province of Utrecht, followed by business services (17%), healthcare, education and ICT.

As far as entertainment is concerned, several festivals are organized each year such as the Netherlands Film Festival or the Utrecht International Chamber Music Festival. In 2015, it was the start town for Stage 1 of the Tour de France. Utrecht has one of the Netherlands’ highest bicycle densities and would like to complete the world’s largest bicycle shed (for 12,500 bicycles).

Investors are attracted by the quality of its infrastructures and the competitive fiscal climate. 375 foreign companies currently operate within the city center. For instance, Nutricia, Ziggo, Bol.com, Capgemini, Rabobank and Wincor Nixdorf have opted for this city. In 2009, Utrecht registered almost 3,000 startup companies.

Hotel investors have good reasons to be interested in this destination. Utrecht posted one of the best European performances in June 2016. This city has a total hotel supply of around 1,500 rooms, of which 1,064 are branded (including 715 in midscale hotels and 218 in upscale hotels). The economic recovery in 2014 was confirmed on 2015: the occupancy rate grew by 5.6 points and the average daily rate by 2.2%, leading to a 10.4% increase in Revenue per Available Room (RevPAR). From January to June 2016, its RevPAR progressed by 76.4%, with an occupancy rate of 77.9%.

Among the projects, Amrâth Hotels will develop a 4-star hotel (250 rooms and 350 villas) as part of the CU2030 project for a mixed-use concept area. Utrecht municipal authorities are working towards an addition of 1,000 hotel rooms before 2020. Current available accommodations focus on business travelers.

Although Utrecht is a university city, it lacks special concept hotels and hostels for backpackers. The city is looking for high quality, bed & breakfasts, low budget, small hotels and properties offering “experiences.” The new zoning regulations will allow for more small hotels (up to 15 rooms), especially in the eastern part of the city and in the city center. Authorities of the city want to develop the “experience hotel” concept following three criteria: the hotel must be part of a historic or an original building. It also must offer a unique concept for the Netherlands, where spending the night is on equal footing with any other leisure activity. Finally, the hotel must have a unique interior design or exceptional quality all by itself, that gives it strong appeal for new target groups and overnight tourists staying in the city. Utrecht is the capital of a wealthy, business-oriented province with a strong services sector. The economic structure has little industrial and agricultural activity, but a highly educated workforce and sophisticated business sector. Employment in public and business sectors is slightly higher than that in the Netherlands overall and the EU.

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