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Sharp rise in office take-up

The Dublin office market performance continues to improve, with total take up for the first six months of 2011 comprising 85,640sqm -- an increase of almost 70pc on the same period of 2010. This has helped reduce the vacancy rate to, an albeit still high, 20.7pc.

Fionnuala O'Buachalla, director at Jones Lang LaSalle, said some companies are moving due to lease terminations and break options, but even more encouraging has been the fact that 59pc of tenants took space in Quarter 2 to cater for expansions.

She says rents averaged €248 per sqm in the city centre and €167 per sqm in the suburbs during the quarter. CBRE, on the other hand, points out headline prime city centre rents are at €323 per sqm, while those on the western suburbs are the lowest, at €145 per sqm.

CBRE representative Willie Dowling says a number of very significant office enquiries have yet to be fulfilled, including those from CITI, the Central Bank and BNY Mellon, which bodes well for take up in the second half of this year.

"However, once many of these requirements have been catered for, there is little visibility on where the next wave of demand will come from," he adds.

JLLS says 82pc of lettings in Quarter 2 were less than 929sqm and they detect a shift in locational demand, with 65pc of total take up being in the suburbs and 35pc being in the city.

However, the Paddy Power letting of 11,000sqm in Clonskeagh was a key factor in shifting the balance towards the suburbs.

They say 25,800sqm is already reserved for Quarter 3 2011.

Irish Independent