Dublin Office space take up levels highest since 2007

196,000sq m of office space has been let so far this year with majority in central business district

Development activity in Dublin increased in the third quarter by 11 per cent. Photograph: Bryan O’Brien/The Irish Times

Development activity in Dublin increased in the third quarter by 11 per cent. Photograph: Bryan O’Brien/The Irish Times

 

The first nine-months of this year saw the highest take up of office space since 2007 in Dublin, figures from commercial property company Cushman and Wakefield show.

As a result of the 196,000sq m of office space let so far this year, the company projects the annual total to exceed 250,000sq m.

Commanding the highest share of the take up are IT and telecommunications companies, led by occupiers such as Facebook and LinkedIn.

As take up of space increased, availability levels dropped in Dublin by 1.9 per cent as the volume of second hand space being released slows down. The net vacancy rate now stands at 8.3 per cent, down from 8.9 per cent in the second quarter.

Dublin’s central business district (CBD) did, however, record slight upward movement in supply, “partly reflecting the release of newly refurbished builds in the city centre which have not yet been taken up”, the company said. So far this year, 58 per cent of all occupied space as been in the CBD, of which 36 per cent comprised of newly completed office space.

Development activity in the capital increased in the third quarter by 11 per cent to 370,450sq m, with 22 per cent pre-let and a further 14 per cent reserved.

“While new construction starts increased this quarter, the medium-term view is that the quantity of new starts will slow down, as the lack of good sites and finance impacts developers, particularly in the CBD,” said Ronan Corbett, head of offices at Cushman and Wakefield.

As the company predicts pricing pressure next year, with CBD rents rising 4 per cent, Mr Corbett also forecasted a slow down in supply. “Assuming demand remains robust, and all indications are that this will be the case, supply levels could begin to tighten again,” he said.