Irish land sales totalled approximately €99m in the second quarter 2021, bringing the total year-to-date turnover to €193m, according to new data from property advisor, Savills Ireland. This represents an increase of 15% on the same period in 2020, when turnover reached €167m.
Savills expect to see several large deals sign by the end of the year, which will drive turnover higher in the final half of 2021. The market for commercially zoned land remains strong, with Savills reporting high levels of interest in the former City Arts site on Dublin’s City Quay (1-6 City Quay). The site, which extends to approximately 0.55 acres, has the potential to accommodate an office development of approximately 142,000 sq. ft., subject to planning permission. The site was offered for sale with a guide price of €35 million, with a number of bids received well in excess of the guide price. As part of this process, Savills also witnessed a number of new funding sources entering into the market, most notably from the UK and the Middle East.
The largest deal of the quarter was an off-market sale in South Dublin, representing a €15 million trade. Another notable transaction was the sale of an 11-acre site on Glenamuck Road, Dublin 18, which traded for €10.5m. The site has full planning permission, granted by An Bord Pleanala in 2020 for a Strategic Housing Development of 197 residential units. This follows on from a deal for a 33-acre site on Glenamuck Road in Q4 2020, which sold for approximately €20 million. There is a third site of approximately 7.5 acres in the area, which has just gone sale agreed.
Another notable sale in the quarter was the M3 Gateway Lands site in County Meath, reportedly traded at a price in excess of €10m. This is an industrial site with the potential for a logistics/distribution hub or data centre. Savills say there is currently a dearth of suitable logistics space in Dublin with industrial and logistics space in the capital having a vacancy rate of just 1.2%. This could lead to an increase in demand for greenfield sites with industrial related zoning around the capital in future quarters.
Commenting on the figures, Director of Development Land at Savills Ireland, John Swarbrigg said, "With strong activity in the residential market in the first half of 2021, it is unsurprising that the majority of the land sold had residential related zoning. Indeed, it is likely that the strong growth in house prices helped to drive demand for residentially zoned land. In total, we estimate that residential zone land sales accounted for more than 75% of total sales volumes."
He added, "Sites with planning permission have risen in priority in recent years, primarily due to the fact that almost 1 in 3 planning permissions under the SHD process are now going to judicial review. It is promising that the government has finally recognised the inadequacy of the Strategic Housing Development planning application system, however, in the interim certain financiers – and by extension developers – are unwilling to take on planning risk until we have more clarity on the matter. Land with full planning permission has always traded at a premium, but in recent years we have seen this gap widen."