Irish office market second quarter more subdued than first
Following a robust performance in the Irish office market in the opening quarter of 2017, the second quarter was more subdued in comparison, according to Cushman & Wakefield. A total of 38,600 sq m transacted in the three months to June, bringing total take up, across the four regional office markets over the six-month period, to 140,950 sq m.
An exceptional first quarter of the year resulted in activity for the six-month period standing 24% higher than the long-run average.
Once again, leasing activity was driven by Dublin, accounting for 91% of take up in the period. In particular, the Dublin CBD market accounted for 61% of Irish office occupation; this compares with 42% in the same period in 2016.
Outside of Dublin, activity remains subdued across the three regional centres, all of which are suffering from a shortage Grade A space. Activity in the six months to June was strongest in Limerick.
Grade A availability and vacancy rates continue on a downward trajectory across all markets. The shortage of Grade A space is most acute in Galway, with just 6,150 sq m of space net available at the end of June.
Development looks set to remain a feature of the Irish office market for the medium term, with quite a large number of schemes in the pipeline. Notably in Dublin, a total of 334,850 sq m of space was under construction at the end of quarter two, of which a very healthy 27% is pre-let, and a further 11% reserved. It is anticipated that, as the year progresses, pre-lets will increase further and approach 50%.
