Dublin office rents close to peak levels

Headline rents up 22% to €55 per sq ft last year

Commercial buildings in Dublin’s docklands Photograph: Cyril Byrne / The Irish Times

Commercial buildings in Dublin’s docklands Photograph: Cyril Byrne / The Irish Times

 

Headline rents in the Dublin office sector rose by 22 per cent last year and closed the year at €55 per sq foot, according to an analysis by commercial property agent HWBC. This would be just below the peak figure before the property crash in 2008.

It also found that take up in the Dublin office sector finished more than 13 per cent higher last year at more than 249,000 sq metres. The market vacancy rate dropped below 10 per cent for the first time since 2006.

“The shortage of CBD [central business district] space made it another tough year for tenants facing longer lease terms and reduced incentives, with landlords generally calling the shots in negotiations,” HWBC said.

Biggest deal

According to the agent, the biggest office deal of 2015, in terms of space let, was Baggot Plaza on Upper Baggot Street in Dublin 4 with Bank of Ireland as the tenant.

Other deals in the top 10 involved lettings to Workday, HCL, Twitter, Indeed. com, ESB International, Accenture, Aercap, Stripe and CRH.

HWBC said there was “no let up in tenant demand” with more about 200,000 sq metres of space being required by companies such as Facebook, Google and Airbnb.

The company said there is currently about 182,000 sq metres of office development underway in Dublin 1,2 and 4 with half of this already pre-let.

“New supply coming on stream from 2017 should help stabilise the market for occupiers, which will ultimately benefit all stakeholders,” HWBC said.