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Value of office development land in Dublin grew by almost 27% in 2015

Written by Robert McHugh, on 10th Feb 2016. Posted in Ireland

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The Society of Chartered Surveyors Ireland have today released their Commercial Property Review and Outlook 2016 report.

Close to 500 Chartered Surveyors were surveyed for the SCSI annual report which was developed and published in conjunction with Future Analytics Consulting.

The report predicts that prime office and retail rents in Dublin are expected to rise by about 12% in 2016, while residential development land values in the capital are expected to rise by a similar amount.

According to the report, the value of residential development land in Dublin was up almost 20% in 2015. The value of office development land in Dublin grew by almost 27% in 2015. There is a 16% rise forecast for 2016.
 
Surveyors expect prime office rents in the rest of the country to increase by between 5% to 6% while retail rents are expected to increase by 7% to 8% in Munster and Leinster (excluding Dublin) but by 4.5% in Connacht.

The survey found that investment in the commercial property market reached approximately €3.7 billion in 2015. While this figure is below the record investment level of €4.5 billion achieved in 2014, it nevertheless represents an exceptionally buoyant year for Irish property investment, as all sectors of the market recorded marked increases in activity. 
 
The Review found that prime office rents in the capital were priced at €561 per sq. m at the end of 2015 but are set to increase by a further 11.7% this year.
 
In the retail sector, retail rents in Dublin’s Grafton Street grew by approximately 17.9% in 2015. Rents increased by 16.8% for prime rental in Dublin as Zone A prices reached €5,247 per sq. m. Respondents to the survey expect prime retail rents in Dublin to increase by 11.5% in 2016. In Connacht/Ulster, they are expected to increase by around 4.5% and in Munster and Leinster by approximately 8.0% and 7.2% respectively.
 
SCSI Commercial Agency Professional Group Chair, Brian Meldon says, "While some respondents are anticipating an increase in supply in 2017, no new office space has been delivered to the Dublin market for the last five years and as a result demand continues to surpass supply.

"As a result, there are ongoing concerns about Dublin’s ability to continue to attract service sector Foreign Direct Investment in the absence of appropriate office space."

Source: www.businessworld.ie

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