Dublin rents ranked more highly than its yields
Published 30/11/2011 | 05:00
Dublin rents are still ranked much higher in European market terms than are Dublin property values.
Rents for the prime Dublin retail properties, at €2,350 per sqm, are ranked as being 17th most expensive in the league table although they have slipped in the rankings from 15th highest last year.
In contrast, prime Dublin retail values are ranked as being only 34 in the values league or 12th cheapest, with yields estimated as high as 6.5pc.
While Dublin's retail rents are less than one-third of those charged in league leader London's West End, nevertheless Dublin retail rents are still higher than those in some European cities, such as Barcelona, Copenhagen and Brussels.
Reflecting lower property values, yields for Dublin shops are ranked cheaper than those in Birmingham, Edinburgh, Glasgow and Manchester, which range between 5pc and 5.25pc, although Dublin's rents are well above those in these four British cities.
The survey of 46 cities in Europe, the Middle East and Africa (EMEA) was conducted by CB Richard Ellis in the third quarter of this year.
While some landlords might not welcome it, some agents would welcome how the league shows an improvement in the competitiveness of Dublin's office rents, as this improvement should help attract foreign direct investment.
With a 14pc fall in prime Dublin office rents over the past 12 months, to an average of €323 per sqm, these are now ranked 23rd in the league. This is a sharp drop from their position of 13th a year ago.
Meanwhile, office yields at 7.5pc are ranked 33rd, which is a slight increase in the rankings as other cities have fallen down the pole.
Despite a 44pc increase in Dublin office take-up during the previous 12 months, the local market still shows one of the highest vacancy rates, at 22.5pc -- the seventh highest and exceeded only by six Eastern European cities lead by Belgrade in Serbia.
On the other hand Dublin vacancy levels have declined slightly at a time when the overall European vacancy levels increased slightly.
The CBRE analysis also indicates that Dublin is one of only four cities still in the downward phase of the office rents cycle.
Meanwhile, the majority of European cities showed no retail rental growth with the exceptions of Milan, London and The Hague. Only Athens and Zagreb recorded a fall in retail rents.
But consumer sentiment across Europe fell in quarter three.