The process has already begun. At 10.59pm on Friday, March 29th, a minute before the United Kingdom had been due to leave the European Union, £9 billion, or about €10.5 billion, in assets will be transferred by Aviva to a new company based in Ireland.
The move, recently approved by the British high court, is part of a wider withdrawal of assets and capital by companies looking to keep a base in the European Union after Britain departs. Whatever happens with Brexit now, the erosion of London's position at the heart of the European financial markets looks likely to be irreversible. And, so far, Dublin stands to be a beneficiary of sorts.
According to a recent report by the think tank New Financials, more than 250 firms in banking and finance “have moved or are moving business, staff, assets or legal entities away from the UK to the EU” – a number that it believes will increase.
“Dublin has emerged as the clear winner in terms of attracting business from the United Kingdom, with 100 firms choosing the Irish capital as a post-Brexit location. This represents 30 per cent of all the moves that we identified,” the report states. Nearly half of asset managers, hedge funds and private equity firms in its sample had chosen Dublin.
For now, most of the focus is on moving capital, not jobs. But that’s likely to change. The think tank has identified 5,000 jobs set to leave London (some of these may involve local hires in Dublin), and expects that to grow.
“We are seeing a lot of companies testing the market. We’re seeing it across the board, predominantly in financial services,” says Orla Doyle of Lincoln Recruitment, citing interest in Dublin from asset management, insurance and banking, private equity and fintech firms in particular.
“Over the past couple of months a lot of companies are trying to get their leadership teams in order. So it’s the more experienced professionals that are coming over now.” For now, the number of new roles being created or transferred is low, but her firm expects that to increase.
“Dublin is fighting with Frankfurt, Paris and other major European Union cities for business,” but overall, “Dublin seems to be the top location”.
So is Dublin ready for the Brexodus?
The Irish Times spoke to recruiters, relocation consultants, real estate agents, NGOs working in the area of migrant rights, and those who have made the moves themselves, to assess the challenges and opportunities for Dublin post-Brexit.
“Housing and schooling” are the big issues for high net worth executives moving over here, says Barbara Carty, property consultant with Inhous.
Her firm provides relocation services to “roughly two executives moving because of Brexit every six to eight weeks”. A number of financial services companies are “now placing their executives here to test the waters. They’re not moving them en masse: the back-office guys are not relocating yet. But at an executive level, there has been a constant flow.”
Grainne McCabe, of the Relocation Bureau in Dún Laoghaire, says her firm is already feeling the Brexit bounce, with about a 30 per cent uptick in inquiries.
Executives moving here because of Brexit mostly choose to rent, and they’re usually in the market for a large family home, says Carty. “They could pay up to €7,000 a month. But for that, they want everything to be absolutely pristine – they’re looking for new bathrooms, new kitchens, all new flooring. They won’t look at anything that’s tatty or has slightly older bathrooms. It is hard to find that kind of quality property in Dublin. That said, we’ve never not been able to find a house for a client,” she says.
Carty hasn’t had to field too many unusual requests. “The cooker can be a very big deal for some clients, particularly Chinese families, who might want us to ask the landlord if they can put a wok cooker in. And we once had a request from someone who wanted a house with a recording studio.”
Such houses on the south side of Dublin are in short supply, so Carty has been encouraging clients to consider areas on the north side including “Howth, Malahide and other areas on the north side where rents might not be as high, and they’re near the airport and have good schools”.
For executives relocating without families, Dublin city centre is where they want to be, says David Moreau of Onboard Relocations. “The main difference we see is that if you’re an Irish person, you’ll rent anywhere that’s commutable.
“A lot of expats wouldn’t have a car, and may not want to take on that cost. So they tend to gravitate towards the city centre, but the housing stock is very limited there. What would make Dublin city much more attractive would be a lot of high-rise residential development. You’d have new stock and you’d get the kind of density required.”
Ben Thompson is a sales agent with Churches Estate Agents in Blackrock, who moved to Ireland from the UK eight years ago. He has just sold his first house to a “Brexile” – a banker in his early 40s, moving over with his partner and young child, who had bought a four-bedroom townhouse in the city centre.
“They wanted to live in the heart of the city. They lived in a similar location in London. They could have bought some bigger in the suburbs, but they wanted to be able to walk to work and enjoy the nightlife.”
Carty says: “We’ve also had a few inquiries from London for Irish families who want to buy their house here now, and rent it out for a few years, because their five-year plan is now to move back. They could be looking to spend €3 million up in certain locations. [That end of] the property market has definitely stalled here, and houses are not moving, so they feel it’s a good time to buy.”
At the top of the market, the main issue for Dublin is supply rather than affordability, all experts agree.
Executives moving to Dublin with their families will have done their research on schools, and many arrive with their minds already made up. They’ll have decided on private schooling in general, and in particular St Andrew’s in Booterstown in Dublin, which has a tradition of accepting pupils from international families – “and it can be really hard to get them in there”, says Carty.
Even at primary level, there are long waiting lists for places in private schools in south Dublin. “We can end up putting the child’s name down in four different schools, and paying four deposits of around €1,000 each,” she says. “And you don’t usually get it back.”
Last year, she relocated a family with a child due to go into first class. “His name was down in every school in south County Dublin.” It was only in August that they finally got a place. Carty has had some success educating families about the benefits of non-fee-paying national schools, she says.
The opening up of Nord Anglia International School in Leopardstown – which teaches the International Baccalaureate and charges fees of up to €24,000 a year – offers another option to wealthy families, says Moreau, particularly those who might move again before their child’s education is finished.
“The opening of schools like that are important infrastructural development.”
Under the Common Travel Area, Irish and British citizens move freely and reside in either jurisdiction, enjoying associated rights and entitlements. Brexit should have no impact on that, says Richard King, project leader with the Migrant Project at Crosscare.
For those planning to move here whose citizenship is from outside the EU, or for the non-EU spouses or partners of Brexiles, Brexit is causing some uncertainty. “We’ve had ongoing queries from UK citizens with non-EU family members,” says King. Details on how those families will be affected are still emerging. However, he warns that British citizens may not continue to enjoy all the rights they had as EU citizens with regard to bringing their non-EU family members here.
“As an EU citizen coming here, you have better rights than an Irish citizen. There’s nothing other than the Constitution that says that an Irish citizen can have their non-EU family come here, whereas there is a legislative basis in EU law for EU workers living in Ireland. What we’re guessing is that UK citizens will end up [with rights] closer to those of Irish citizens than EU ones.”
Currently, the non-EU spouses of Irish citizens can face waits of up to a year for their work permit to come through. The unmarried partners of Irish citizens always have a minimum of a six-month waiting period before they can work, he says.
For non-EU citizens coming here on a work permit, the ability of their spouse or partner to work depends on the class of permit they have, says Moreau. To apply for a spouse work permit, you need a job offer from an employer registered and trading in Ireland.
In practice, “if your wife moved here with a multinational, and you wanted to work, you’d have to wait for anything up to two or three months and you [would] have to ask the employer to have some input into the application. A lot of employers may not consider somebody applying in that category in the same light.”
The paperwork is problematic for anyone moving to Ireland from outside the EU, “no matter who they are”, says Grainne McCabe, a senior account manager with the Relocation Bureau. She describes the online system of application for an Irish residence permit card as “a nightmare”.
“They haven’t thought it through properly. When you complain to them, they come back with the standard reply that there are appointments available and [you] have to keep trying. So [people] try every day at 10 o’clock and 2 o’clock, sitting their refreshing the browser.”
It’s like trying to get tickets for a U2 concert, she says – “only you get enjoyment out of your U2 concert. When you go to that place on Burgh Quay, there’s no enjoyment.”
A looming paperwork crisis for British nationals has receded along with the threat of a no-deal Brexit. If there is an agreed departure, UK driving licences will continue to be recognised across the EU.
Transitioning to an Irish driver’s licence is “particularly tricky for US nationals,” says Moreau. They can continue to use a US licence for up to 12 months as a tourist, according to the US embassy. After that, they need to convert to an Irish driver’s licence – a process which involves taking six lessons, sitting the theory test and then the full test.
Insurance can be very expensive for people who don’t have a track record with an Irish insurer, he adds. One solution lots of younger expats are availing of are e-cars. “That’s a brilliant service for expats, especially the younger professionals – it’s really popular with them.”
Access to healthcare is not typically a huge concern for those arriving post-Brexit. The most significant issue can be with managing to register with a GP practice, particularly in rural areas, where many GP practices are closed to new patients, says King. However, as Dublin is well serviced for GPs, he doesn’t expect this to be an issue.
Quality of life
A report published this week ranked Dublin in 33rd place, ahead of London, Paris and Madrid, for quality of living. Dublin moved up one place on last year in the Mercer report, which rated 230 cities, because of its stable political environment, lower levels of air pollution and a strong socio-cultural environment.
Dublin “is a relatively easy sell”, says Doyle. “Particularly in financial services, there are really good opportunities for career progression. It has a very good reputation from the social perspective too.”
Carty says her clients are typically “really positive about the city. They love that it’s so accessible to Europe and it’s so easy to get around. The restaurants are really good now too.” Even the weather doesn’t put them off – “it’s less extreme than some of the places they might have lived”.
Thompson doesn’t expect the move from London to Dublin to present any kind of culture shock for Brexiles. “Brits are terrible for this – and I know because I am one: we see Ireland as part of the UK. You can swan over here on a weekend break, so moving for work, it feels just like you’re in a UK regional city,” he says, before clarifying: “That’s quoting old me, not new me. I know better now.
“A banking type person will be probably have spent time in New York or Sydney. Dublin now has comparable night life and restaurant scene to any one of those cities. I wouldn’t go back to London now: Dublin is much more family oriented, less intense, and it offers a better pace of life. And it’s cheaper.”
Cost of living
In fact, a recent Knight Frank report ranked Dublin in the second tier of the world’s least affordable cities.
But for high net worth individuals in banking and finance, it probably doesn’t matter all that much – particularly if they’ve spent time in one of the even-more-expensive hubs, such as London, Sydney or San Francisco.
For those starting out in their careers and on less generous salaries, the cost of living may be more of a deterrent. “It’s a huge challenge,” says Ilaina Khairulzaman, who moved to Dublin five years ago from Malaysia, initially on a student visa, and now works with an NGO.
When she moved here first, the rent on a double room in Dublin 2 was €500. Now it’s double that. “The same amount of money could rent an entire house back home – is it worth staying in a country where the living cost is so high? I’m really lucky with my landlord, because if I had to move, I couldn’t afford anything else. If you’re able to afford the cost of living and you know what to expect, Ireland is a wonderful place to live. I work with great people, I have great friends. But you need to be realistic.”
For financial institutions dipping a toe in Dublin ahead of Brexit, and executives arriving on substantial relocation packages, the cost of living and squeeze on housing probably won’t put them off.
But their arrival will almost certainly contribute to that cost of living, points out King. “Any big influx of people into an area with limited housing supply is going to have an impact on rents in that area.”
When it comes to the post-Brexit bounce for Dublin, it may be a case of be careful what you wish for.