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JLL: steady demand in Dublin office market

In the year-to-date, take-up is 2.2 million sq ft. The increase in the quarter was caused by a rise in the number of larger-sized deals, with 2 greater than 50,000 sq ft, compared to none last quarter.

As per last quarter, the suburbs saw the most activity accounting for 61% of take-up. The top 3 deals in terms of size were in the suburbs. TMT companies made up the largest share of activity, with 31% of take-up. TMT companies who occupied space in the last 3 months include Elavon and AirBnB.

Hannah Dwyer, Director of Research at JLL, explains:

“It is positive to see that take-up has remained steady in the third quarter with close to 400,000 sq ft of demand in the last 3 months. In addition to the space that has already signed, there is also an additional 1.7 million sq ft of space that is reserved and did not sign in Q3.

“With year-to-date volumes at 2.2 million sq ft, and such a high level of reserved space, we expect a strong Q4. We expect year-end take-up to achieve over 3.0 million sq ft. Whilst this is lower than the 3.9 million sq ft achieved in 2018 (a record year for market activity), it is significantly higher than the 10-year average of 2.3 million sq ft.”

On the supply side, supply remains tight, with overall vacancy for completed stock at 7.1%. Excluding reserved space, the vacancy figure is 4.9%. In certain locations, supply remains even tighter, with 4.9% of space in D2 vacant. When reserved space is excluded from this, the vacancy rate drops to just 2.6%.

In addition to the completed space, there is currently 5.4 million sq ft of space under construction, or which 81% is in the city centre. There is also an additional 6.1 million sq ft with full planning permission across the entire market.

Hannah added:

“Existing supply remains tight in the Dublin market, particularly in some core sub-locations like Dublin 2. Whilst there is a steady stream of pipeline activity, the trend for pre-lets and mid-lets continues, with 53% of space currently on site in the city centre already committed.”

james.wallace@realassetmedia.com