Dublin wins Brexit battle...for now
While Dublin may be holding its own in the battle for Brexit business, with banking giants such as Bank of America, Barclays and JP Morgan all committing to increase their presence here, the overall economic impact of the UK's departure from the EU will be negative. That's the point that managing director at agents Murphy Mulhall, James Mulhall, says must be remembered following his firm's release of the latest figures for office take-up in the capital.
Murphy Mulhall's Market Monitor for the first half of 2017 shows that some 1.78 million sq ft of office space was taken up to the end of June. The figure compares favourably to the 2.8 million sq ft take-up for the entire year in 2016. Although the market is largely made up of deals within the 0-10,000 sq ft size-band, there have been some significant pre-lets in the course of this year, with 23pc of all deals for 10,000 sq ft or more.
Quite apart from what Murphy Mulhall say are "encouraging levels of take-up", the market has seen strong market rents and lease terms for new CBD and suburban space. Prime Rents are now hovering between €55 and €60 per sq ft while deals are commonly being struck on terms of 10 to 15 years. Murphy Mulhall reports that landlords are not yet being forced to offer too many incentives to prospective tenants, with rent-free periods of 6-12 months being offered for long leases.
Commenting on the performance of the Dublin office market currently, James Mulhall said: "The strength of take-up and volume of pre-letting activity, particularly in the second quarter, demonstrates that there is a healthy demand for the new office space coming out of the ground."
On the impact so far of Brexit, he added: "Overall it's been positive so far for the office market. However, we need to be mindful that Brexit economically will be negative for Ireland. Any office market is clearly aligned to its country's economic performance. Right now, we're getting a bounce from Brexit but it won't define the market."
Paul McNeive is away.