Hibernia Reit chief predicts office rent growth will slow
Hibernia Reit CEO Kevin Nowlan has downplayed the prospects for prime office rents in Dublin, saying he expects the rate of growth to slow as landlords compete for tenants.
Speaking to the Irish Independent following the publication of Hibernia Reit's latest set of results, Mr Nowlan dismissed the suggestion that the Comer Group's recent agreement of a rent of €70 a square foot with aircraft leasing group, Avolon, for office space at Number One Ballsbridge represented the new benchmark for the market.
"Our valuers' view is that the market for prime [office space] is now €62.50 per square foot," he said. "This year there's going to be over two million square feet of space delivered, so for the first time in the last four or five years, there's going to be competition between landlords for tenants. Up to now, it had been just one building finishing with a group of tenants having very limited choice. You're going to see growth in rents slowing."
Preliminary results for the year to March 31 last show the value of its properties grew by 9.9pc to €1.167bn. Rental income increased by 56.3pc to €39.7m, while it saw profits before tax of €119m following the inclusion of a surplus from the revaluation of its properties.
It is set to pay shareholders a final dividend of 1.45 cent a share, bringing its total payout for the year to 2.2 cent a share - 46.7pc more than the 1.5 cent paid in 2016.
Hibernia Reit is currently involved in three major office schemes in Dublin's central business district at Windmill Lane, Sir John Rogerson's Quay, and the Hanover Building.