Digital Hub warns of need for emergency funding from State
Client companies struggling to pay rent that delivers most of agency’s income
Dublin’s Digital Hub, home to more than 70 companies, has warned it may need to seek emergency funding as Covid-19 impacts its finances.
Dublin’s Digital Hub, which is home to more than 70 companies, has warned it may need to seek emergency funding from the State as Covid-19 impacts its finances.
According to briefing notes recently prepared for Minister for Communications, Eamon Ryan, the Digital Hub Development Agency alerted his department in April of the effect of the pandemic on its capacity to generate commercial income.
The news comes as the Government is to announce a new €12 million enterprise centres fund.
A spokesman for the agency told The Irish Times it has worked with client companies facing rent challenges “and found creative solutions to support their continued operations.”
“With a relatively fixed cost base it was prudent to flag the anticipated financial shortfall for this financial year, on which we are in ongoing discussions with the department for additional support,” the spokesman said.
“We have taken steps to achieve savings where possible in our operating costs,” he added.
The agency operates under the aegis of the department and is funded through a mix of commercial income – rent from client companies – and State funding of €795,000 per annum.
In 2018, the last year for which accounts are publicly available, it recorded revenues of €4.2 million, of which €3.3 million was from rent.
Consultants Grant Thornton were appointed by the Department for Communications in December to undertake a review into the agency. The department has said that any request for emergency funding will only be considered in the context of the recommendations from that study.
The department’s review is in part intended to conclude whether the agency should be allowed to expand further, given the increases in commercial property values and a lack of housing in the capital.
Since the Digital Hub was established in 2003, more than 200 companies have passed through its doors including some well-established companies such as Stripe. The agency, which is headed by former Abbey Theatre director Fiach Mac Conghail, claims to be the largest cluster for digital companies in the State.
It occupies 10 buildings of which nine are in use for the purpose of the cluster. Over 50 per cent of the campus has been developed with 72,000 sq ft of lettable office space currently in use.
The hub offers flexible office arrangements and business support services to growing tech companies and is also involved in providing digital-related learning and training opportunities geared to the local community.
“Notwithstanding the near-term challenges, we remain confident that the Hub can continue to provide the sort of creative community that since its foundation has provided a home to over 400 companies, and supported over 2,000 jobs, making a major contribution to the regeneration and revitalisation of the Dublin 8 area, the agency spokesman said.