Tuesday, July 29 13:58:48
Sales of industrial property in Dublin continue at pace due to improved occupier confidence and the value for money that is currently available in the market, according to property consultants, Savills.
In its latest report on Dublin's industrial property market, it reports that sales accounted for almost four-fifths of transactions in Q2 - nearly twice the proportion recorded in the same period last year.
"On one hand, outright sales are being driven by the Capital Gains Tax waiver which will remain in place until the end of this year. But more fundamentally, the dominance of sales reflects the fact that industrial units in many locations can now be bought for as little as half of what it would cost to build them," said Gavin Butler, Director of Industrial at Savills.
Total take-up of industrial space in Q2 was approximately 62,000 sq.m. - a 78pc increase on the first three months of the year. As a result, the availability of vacant space is now 21pc lower than at this time last year.
Dr. John McCartney, Economist and Director of Research at Savills Ireland, says that an increase in services and manufacturing sector activity is underpinning occupier demand for industrial property.
"More than 90pc of Q2 take-up was accounted for by services and manufacturing firms, which reflects strong underlying activity within these sectors. This is reflected in the latest purchasing managers' indices, which show that manufacturing orders increased at their fastest rate for 40 months in June, while service sector firms have expanded their activity in every month since August 2012."
Commenting on the market outlook for the remainder of 2014, Gavin Butler said; "With the economic recovery firmly taking hold, occupiers are now beginning to plan for their longer term needs. Therefore, we expect that demand will continue to come from those expanding out of smaller facilities as their short term leases begin to expire. As a result, take-up is likely to remain strong for the remainder of this year and vacancy rates should continue on the long-term downward trend."
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