Sunday 15 September 2019

Only 20 residential schemes have potential to deliver more than 100 units in 2018 – Cairn Homes

Over 68,000 employees will be forced to seek accommodation in the suburbs according to Cairn Homes
Over 68,000 employees will be forced to seek accommodation in the suburbs according to Cairn Homes
Ellie Donnelly

Ellie Donnelly

Housebuilder Cairn Homes has said that there are only 20 live residential schemes that have the potential to deliver in excess of 100 completed unit sales in Ireland this year.

The bulk of these schemes are in Dublin or in the Greater Dublin Area, with only two located outside of the capital – Glenheron in Wicklow, and Churchfields in Meath.

In a report ahead of its capital markets day, the group said that it is very difficult for building companies to leverage benefits of scale unless they are working on multiple large scale schemes.

"Ireland today has only two companies that are on multiple large scale sites, and does not have an efficient, functioning homebuilding industry," Cairn said.

This report comes on the back of a recent Goodbody note, which said that the top 20 homebuilders in Ireland only sold around 1,600 units in the first half of this year, in comparison, the top 20 homebuilders in the UK delivered 50pc of total UK supply in 2017.

In Ireland, the top 20 homebuilders are delivering just 9pc of annual national demand for housing units, Cairn said.

In addition the group said that increasing the supply in the Irish homebuilding industry is being constrained by the inability of builders to scale up at pace.

Cairn added that, despite the large number of apartment schemes that are through planning or in planning, and benefitting from density and height changes, it estimates that only around 3,500 apartments will be delivered by the end of 2021 in Dublin’s central business district.

This, the group said, was a "critical undersupply" for a city that is growing at the pace of Dublin, and attracting continued foreign direct investment and Brexit related jobs.

The group added that the pace of office construction in Dublin continues to "significantly exceed" apartment construction.

"With enough office space to be delivered between 2016 and 2021 for 82,000 people in Dublin’s CDB, we estimate that just over 6,000 apartments will be built in the same period, meaning over 68,000 employees will be forced to seek accommodation in the suburbs," Cairn added.

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