Growth of public sector proves key driver of Dublin office market

Savills report finds 500,000sq ft of additional space needed for new State employees

With most observers of Dublin's booming office market focused on the major deals being done with global tech giants such as Facebook, Salesforce and Google, the role being played by the public sector as a key driver of the demand for space has largely gone unnoticed.

A new report from Savills Ireland director of research Dr John McCartney should go some way to addressing that imbalance, however.

According to his analysis, the Government’s removal of the embargo on public-sector recruitment in 2015 has helped propel the numbers employed by the State to 6.1 per cent above their pre-crisis peak in 2008, and more than 50 per cent above their cyclical low in 2012.

A closer examination of the numbers and their potential impact on the capital’s office market shows that public administration and defence is Dublin’s fastest-growing sector of employment, with 4,900 new jobs created in the last year – an annual increase of 14.7 per cent.


With the average office employee in Dublin now occupying 10.3sq m of space, Savills suggests that the 4,900 new jobs in public administration could potentially translate into a requirement for as much as 50,000sq m (538,195sq ft) of additional business space.

Jobs growth

Commenting on the extent of the public sector’s contribution to the level of activity in the Dublin office market, Dr McCartney said: “The impact of the public sector has gone relatively unnoticed, with some spectacularly large deals in the ICT sector overshadowing its significance. However, since 2012, take-up of office space by public-sector bodies has risen by over 1,000 per cent, which reflects significant jobs growth in the sector – particularly since 2015, when the recruitment embargo was lifted.”

There were several large office lettings to the public sector in the first quarter of 2019. The most significant example of this saw Tailte Éireann – the name of the Government body to be formed by the merger of the Property Registration Authority, Ordnance Survey Ireland and the Valuation Office – pre-let 16,722sq m (179,995sq ft) of space at the Distillers Building in Smithfield.

Elsewhere, the Central Bank has agreed to acquire blocks four and five at Dublin Landings, the million-square-foot (92,900sq m) mixed-use scheme currently under development by Ballymore and its partners Oxley Holdings in the Dublin docklands.

But while the growth in numbers directly employed by the State has served to fuel the public sector’s requirement for new office space, Andrew Cunningham, director and head of offices at Savills Ireland says it “also reflects the Government’s proactive approach to modernising and improving the quality of its business space portfolio to promote productivity and environmental objectives”.

One recent example of this, Cunningham says, was the move by the Department of Health from Hawkins House – which was built in 1965 – to the newly-refurbished Miesian Plaza on Baggot Street Lower.

Ronald Quinlan

Ronald Quinlan

Ronald Quinlan is Acting Property Editor of The Irish Times