Prime office rents in Dublin set to reach peak next year

Prime office rents in Dublin city centre are set to peak at €65/sq ft (£60/sq ft) next year, bringing to an end four consecutive years of rental growth, Irish agency HWBC has forecast.

HWBC said there was likely to be an end to rental growth because of the high levels of office development currently being undertaken in the Dublin market. It estimated that 2.54m sq ft of new space would be completed this year and that almost 4m sq ft was currently under construction.

“Given the large volume of new space coming to market, it is no surprise that rental growth will likely reach its peak next year,” said Tony Waters, managing director of HWBC.

However, he added this should not be cause for concern because tenant demand remained strong: “The economy and employment levels are still growing, which is the principal driver of office demand, with the likely kicker of further Brexit-related demand to come.”

HWBC’s research showed that grade-A city centre rents rose by 8% to €62/sq ft in the first half of 2017.

Take-up of new space was 56% up on the same period last year at 1.67m sq ft, with significant deals including Barclays signing up as a tenant at Green REIT’s One Molesworth Street.

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