Saturday 18 November 2017

Barclays' Dublin plan could see 'large wave' of Brexit arrivals

Barclays has reportedly chosen Dublin as the location for its main EU hub if UK banks lose easy access to the European market. Photo: AFP/GettyImages
Barclays has reportedly chosen Dublin as the location for its main EU hub if UK banks lose easy access to the European market. Photo: AFP/GettyImages
Ronald Quinlan

Ronald Quinlan

Last Thursday's confirmation that Barclays intends to use Dublin as its post-Brexit EU hub in the event that UK-based financial institutions lose access to the single market is being interpreted by analysts at Goodbody as a "small but significant first move in what could become a large wave of relocations by London-based financial firms".

In a note issued on the matter, Goodbody's senior real estate analyst, Colm Lauder, says the anticipated relocation to Dublin of Barclays' European operational headquarters and of other financial institutions from the City of London will serve to strengthen the Dublin office-occupier market further and is likely to elongate the rental growth cycle.

"We estimate that Dublin could gain 12,000 to 15,000 financial sector roles, fuelling demand for approximately 1.5m sq ft (139,354 sq m) of additional space," Lauder said.

While CBRE's recently-released 'Outlook 2017' report noted that the first meaningful improvement in office supply in more than five years will become evident this year, with some 225,000 sq m (2.4m sq ft) due for completion, the fact that 25pc of that space has already been pre-let leaves just 83,612 sq m (900,000 sq ft) left to meet potential demand in 2017.

With many financial institutions in the City of London expected to make early decisions on plans to relocate within the EU as opposed to waiting for Brexit to play itself out, the take-up predicted by Lauder for Dublin could well come quickly, increasing the pressure on demand for space in the capital.

Indeed, last year and long before the post-Brexit referendum speculation attained critical mass, some 245,000 sq m (2.64m sq ft) of office take-up was achieved in Dublin through 264 individual transactions. CBRE reported that 147 of those transactions were to Irish companies, while 58 were to US companies and 33 to UK companies.

With Barclays planning to add 150 staff to its 100-strong Dublin office, Lauder says the company would require approximately 20,000 sq ft of office space based on current staff number projections.

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