Monday 21 May 2018

No let-up for office market as Irish seek space

The Airside South Quarter in Swords in North Dublin is being put on the market with a €12m asking price
The Airside South Quarter in Swords in North Dublin is being put on the market with a €12m asking price
Peter Flanagan

Peter Flanagan

NATIVE Irish companies are expected to drive the next wave of office lettings in Dublin, in a move away from the market that has been dominated by foreign multinationals in recent years.

A new report from property agent CBRE has claimed that Irish firms are increasingly looking for more office space.

Among other examples, the CBRE report notes that the NTMA is seeking more than 6,500 sq m of office space ahead of a possible move from its current headquarters in the Treasury Building.

Up to now most of the office space on the market in the current cycle has been taken up by overseas firms, with technology companies in particular gobbling up huge swathes of office blocks around the Dublin docklands and city centre.

The report also notes that there are fewer major lettings taking place now with "much of the larger requirements in the market having been satisfied".

"As a result, tenant demand has weakened a little over recent months with most current active requirements relatively small in size," says CBRE.

The report also looks at the investment market, with the sale of loans tied to Dublin's Dundrum Town Centre, part of The Pavilions in Swords and the Ilac Centre in central Dublin expected to generate "significant interest".

In addition to loan sales, there is continued activity in the direct market with many transactions continuing to be negotiated both on and off-market.

"We continue to see strong demand emanating from a range of different investor types including several new entrants from outside the jurisdiction, who are particularly interested in scale.

"Recent sovereign upgrades have been helpful in this respect enabling a new layer of institutional investors to consider investing in the Irish commercial real estate market," said the firm," it added.

Elsewhere, JLL is guiding €12m for Blocks A and B of Airside South Quarter in Swords.

The scheme, which was developed circa 2009, extends to over 90,000 sq ft and has some 170 surface and basement car park spaces on a site of approximately 1.7 acres.

The South Quarter takes in rent of €1.5m per year.

Elsewhere, Davy Stockbrokers has upgraded its forecasts for Hibernia REIT's full-year results, noting that the property firm is "undervalued" compared to its peers.

The broker is now forecasting the net asset value of its portfolio to be 127.6c per share at the end of March 2016 and 138.8c by March 2017. That compared to 117.7c and 125.5c respectively in previous forecasts.

Irish Independent

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