THE Irish commercial property market is in worse shape than the residential market.
Commercial property investors, both in Ireland and overseas, are currently engaged in a stand-off because of the Government's election promise to offer tenants the right to tear up existing leases.
Estate agents have warned that this has caused commercial investors to back off the Irish market until the Government finalises its legislation on the issue. Retailers have pressed the Government to ban upward-only rents and leases because they say these are causing huge job losses in the retail sector.
During the week, Frank Daly, chairman of NAMA, acknowledged that some prospective commercial buyers had again raised this issue. He warned that legal actions between landlords and tenants over the reviews could prolong the current stasis in the market.
And the Government plan came just when the market looked like it was about to stabilise. NAMA had just persuaded Treasury Holdings to sell off its Monte Vetro skyscraper offices in Dublin's south docklands to Google for €99m.
The Government move also came at a time when letting activity in the Dublin offices and warehouse market was showing signs of an uplift.
While this letting activity was boosted by the sharp falls in rents, it was also helped by the healthier Irish and international companies, which were engaged in expansion.