Dublin's industrial market take up steady, sales up as buyers see value (IE)
Wednesday 10 August 2011
Savills latest Dublin industrial market research estimates that take up for 2011 will reach 150,000 m², following the completion of 22 deals in Q211. The southwest accounted for the majority of market share at 48%.
The report states that although a drop in space was recorded for the year’s second quarter at 26,800 m²compared to 48,600 m²in Q1, take up will remain steady. It suggests the key to doing deals in 2011 will be flexibility of rents and lease terms as potential occupiers weigh up options with considerable demand driven by downsizing requirements. Despite this downsizing as well as vacant stock being brought to the market by receivers, vacancy levels have in fact only increased by 2.3% from Q1 to Q211
Davina Gray of Savills Research in Ireland says: “Lettings will remain the dominant source of transactional activity however quarter two did record a pick up in sales with purchasers capitalising on current values.”
Gavin Butler, Director Savills Industrial says: “Sales activity has picked up in 2011 as buyers avail of value in the market – but with funding an issue across all sectors of the economy it will be difficult to see a significant increase in the number of deals closing in the second half of the year."
In terms of investment transactions, four properties were sold during the second quarter with prices varying depending on location and quality of stock sold. Non-prime locations achieved between €430 and €510 m², while better quality industrial stock sold in the region of €970 m². Rents similarly varied with prime properties quoting €45-65 m²/year and secondary at €25 m²/year.