How Dublin is becoming a no-go zone for new tech firms
Published 30/08/2015 | 02:30
Remember coming out of a pub at midnight 20 years ago and trying to find a taxi? They were few and far between. Change couldn't happen quickly, we were told then, because of complicated regulatory and legal processes.
Fast forward to Dublin today. Tech companies are desperately looking for somewhere to work in the city. Despite vacant plots the size of football pitches a few hundreds yards from the 'Silicon Docks', there is almost no building activity going on. Only a small amount of limited refurbishments of dilapidated old buildings is happening.
The IDA may downplay it in Silicon Valley - but the city's prime office areas are becoming no-go zones for tech companies looking to set up here. Property market experts say that vacancy rates are 'effectively zero' in Dublin 2 and 4, with not much more on offer in surrounding areas.
Worse, what paltry accommodation that there is on offer is in sub-standard condition or stuck at antiquated 10-year fixed leases. (High-growth tech companies think in quarters, not quarter-centuries.)
There is little sign of improvement for at least another year. In other words, if you are the new Dropbox, Airbnb or Snapchat, Dublin may now not be the place for you to come anymore.
Oddly, no-one has taken responsibility for any of this. Ask around and it's always the same story: Nama. Planning laws. The banks. None of which we apparently control.
"Lots of that is wrapped up in Nama and property portfolios," goes the refrain. "And there are complicated legal procedures associated with property. It's not as simple as just making something available to lease."
Of course it isn't. Because that would then make a crucial industrial build block relatively straightforward with no easements in the fee simples or entailed feoffments.
So what exactly is the IDA telling investment prospects from Silicon Valley when asked about all of this? Is it admitting that Dublin's prime office availability is all but closed for business?
Not quite. It is gamely putting forward the view that there is 'value to be had' looking outside the prime office areas. As an example, it points to €15bn software company Workday which has just relocated from Dublin 8 into Smithfield on the saltier north quays. Then there are tech giants such as Microsoft, which are close to unveiling shiny new campuses way out in the suburbs.
As an alternative position, the IDA compares Dublin 2 and Dublin 4 to London's Oxford Street, where availability and affordability are bound to be very tight.
These arguments all have some truth to them. Workday, for example, is just one of a number of digital tech firms that have moved outside the erstwhile Silicon Docks zone: Yahoo, for example, is situated in Dublin 1, beside the Point Depot. A little downstream, DogPatch Labs is making a go of it in the otherwise dull IFSC area.
In doing so, all these firms may be setting down location infrastructure for the next wave of Airbnbs or Dropboxes to consider. Furthermore, it does seem a little precious that digital tech firms, in particular, must only consider office space in the most gentrified city-centre districts.
But such is the bargain we strike with these companies for the halo we want to market from them. It is the fast-moving, high-profile digital tech firms that currently contribute the most export marketing potential to Dublin's industrial branding.
Their lodging demands may be a little on the high maintenance side. But the deal has always been that they get (or, in some instances, create) nice city living quarters and we then use that to leverage ourselves up into some sort of notional 'tech hub'.
It seems a great pity that, just as Dublin is on the verge of a solid industrial transformation, we're now reverting to the old Irish habit of letting lawyers, bank clerks and civil servants persuade the rest of us that new activity must wait until they're ready to prepare the forms - in triplicate - and post documents to 11 different offices for wet ink signatures.
(This is literally happening: I spoke to one tech firm last week whose lease e-signature was declined, resulting in a huge delay while papers were sent around the world to get scrawled signatures.)
We have to admit it: Dublin has a problem.
Sunday Indo Business