Strong Rebound In Transactional Activity In The Dublin Industrial Sector In Q3
Following disappointing start to the year, bumper volume of transactions in the Dublin industrial market in last 3 months
Dublin, 9th October 2014 – According to the latest analysis on the Dublin industrial sector from property advisor CBRE, take-up in the Dublin industrial market reached almost 110,000m2 in Q3 2014 which combined with the 85,142m2 signed in this sector during the first six months of the year brings total take-up in this sector to almost 195,000m2 for the first nine months of 2014.
The research completed by CBRE shows that there were 53 individual industrial transactions signed in Dublin in Q3 2014, of which 20 comprised lettings. However, a number of large industrial sales that completed in the three month period skewed the result with sales accounting for more than 86% of the industrial take-up achieved in Dublin during Q3 2014. Transactional activity in the industrial sector during Q3 2014 was primarily focused on the Dublin South West (N7) corridor, which accounted for 34% of all sales and lettings completed in Dublin in the three month period. Indeed, 41% of letting activity and 34% of sales activity recorded in the quarter was located along this particular road corridor. A further 19% of the industrial accommodation that either let or sold in Dublin during the quarter was located along Dublin North (N2) corridor while the Dublin North West (N3) corridor accounted for a further 18% of industrial take-up in the capital in Q3 2014.
Industrial take-up in Q3 2014 in the capital was dominated by a number of large transactions, predominantly in the form of sales. Although there were no industrial lettings larger than 4,645m2 signed in the quarter, 27% of combined transactions were greater than 9,290m2 in size; a further 27% of industrial transactions signed in the quarter extended to between 4,645m2 and 9,290m2 in size with a further 22% extended to between 1,859 and 4,645m2 in size. Only 24% of transactions in this sector in the quarter extended to less than 4,645m2 in size with the majority of these comprising lettings.
Prime headline industrial rents rose again to approximately €65 per square metre during Q3 2014 with some further rental growth anticipated in the last three months of the year.
There was also an increase in investment activity in the industrial sector during Q3 2014 with a number of transactions signing in the period, including some off-market transactions. Of the €2.99 billion invested in Irish income-producing assets with a value of more than €1 million in the first nine months of 2014, approximately 2% or just over €64 million comprised industrial investments. In addition, some industrial properties changed hands as part of mixed-use portfolios that traded in the period. According to CBRE, prime industrial yields in the capital are now in the order of 7.25%.
According to Jarlath Lynn, at the Industrial Department at CBRE Ireland “Following a somewhat disappointing start to the year, the last three months saw a bumper volume of transactions completing in this sector. However, a similar volume of activity to that achieved in Q3 will be required again in Q4 if take-up is to match the bumper volume of transactional activity achieved during 2013.”
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CBRE Group, Inc. ((NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2013 revenue). The Company has approximately 44,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through approximately 350 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at www.cbre.com.
In Ireland, with offices in Dublin and Belfast, CBRE is the country’s largest commercial real estate services company, now employing over 130 employees and offering a full range of property services including property sales and acquisitions, leasing and management, investment, corporate services, debt advisory, project management, consultancy, valuations and research. Please visit our website at www.cbre.ie or www.cbre.ie./ni