Commercial rents in Dublin will continue to rise up to the end of 2017, according to HWBC’s Office Market Review 2015. This is due in large part to an ‘acute shortage’ in supply, particularly concentrated in Dublin 2 and 4.
Demand for office space continues to grow, with the market vacancy rate in 2015 dropping below 10% for the first time since 2006. According to HWBC’s Outlook for 2016, one of the major problems the industry faces is the lack of Grade A space to cater for the requirements of larger enterprises, particularly in Dublin 2 and 4. Companies such as Facebook, AirBnB and Google are all seeking to expand their space, while last year’s increasing stream of foreign direct investment drove up demand for new spaces.
A number of new developments are underway in key areas such as the Docklands. However, many of these will not reach completion until 2018, and indeed almost half of these are pre-committed.
Research from CBRE suggests that office supply is a live issue in a number of European cities due to the impact of the economic recovery on levels of office-based employment.
Property investor Green Reit warns however that oversupply could become an issue again from 2018 and that the ‘golden period’ for commercial property is probably already over.
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