The Irish industrial property market was back at 2007 levels in 2013 as take-up to the year end rose 18% from 2012, to 2.87m sq.ft. This was comparable to levels achieved during the peak of the market in 2007, according to the Dublin office of Jones Lang LaSalle, the international property agents. Meanwhile CoStar News, the commercial property news website, broke the news Monday that Blackstone, the US private equity firm, and Google, the internet giant, have split the spoils of NAMA’s four-strong Dublin office Platinum portfolio for a combined sale price of €165m.
Jones Lang LaSalle says in its Q4 2013 Pulse report [pdf] that take-up in the quarter was boosted by 6 large deals greater than 50,000 sq.ft. but the market remains driven by smaller deals, with 62% of take-up for space less than 10,000 sq.ft.
Hannah Dwyer, head of research said that “The biggest issue for the market at the moment remains the lack of availability of prime product. Although vacancy across the whole of Dublin is high, the availability of prime space in key geographies is decreasing with strong levels of take-up and no new construction starts. Occupiers therefore continue to be faced with decreasing choice in certain locations for certain size categories. As a result, some occupiers continue to be forced to consider alternative locations and in some cases, lower quality, secondary space”.
2014 is expected to be another steady year for the industrial sector, with continued strong levels of occupier activity likely. With no new construction starts currently underway and continued strong demand, supply issues for prime space are likely to continue. Initially, this may cause some rental increases, and in the medium term, it may lead to construction and the delivery of new space. There is already evidence of planning applications being submitted, so we may see construction start in the sector in the next 12-18 months.
director of industrial agency said that: “2014 is
likely to show a true turn of market conditions, particularly for prime product.
Occupiers may well be faced with competitive bidding situations driving
increases in values not witnessed for several years”.
Blackstone and Google
says that Blackstone and Google fended off second round offers from Hibernia REIT and
Irish Life to split the 321,161 sq ft Dublin office portfolio between them.
Earlier in the process Delancey was also briefly interested.
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