Industrial & logistics sector sees spike in demand
New figures from commercial property agents CBRE show that the overall volume of demand in the industrial and logistics sector in Dublin rose in the first quarter of this year.
CBRE said the market experienced a spike in short-term requirements for logistics and cold storage facilities from the grocery and pharmaceutical sectors over recent weeks due to the Covid-19 outbreak.
"Indeed, despite the uncertainty that has prevailed in recent weeks due to the coronavirus pandemic, which like in other sectors has seen some transactions being put on hold, the overall volume of demand in the industrial and logistics sector in the capital rose quarter-on-quarter," commented Colin Richardson, Senior Analyst in the research team at CBRE.
CBRE noted demand for more than 135,000 metre squared of industrial accommodation at the end of the first quarter of 2020, up from about 126,000 in the fourth quarter of 2019.
"Within the data centre sector, internet and remote working providers have also seen a spike in activity. This has increased the utilisation rates within most data centres, which will in turn result in increased demand for cloud-based services," Mr Richardson said.
Industrial and logistics sector deals in the first three months of the year were mainly focused on the Dublin North West (N3) and Dublin South West (N7) corridors.
These accounted for 42% and 41% of sales and lettings respectively completed in the Dublin market.
Meanwhile, 8% of industrial take-up in the first quarter of the year occurred along the Dublin North East (M1) corridor while 7% of Q1 take-up occurred along the Dublin North (M2) corridor.
CBRE said many transactions are proceeding in the sector, but with the country on shutdown due to Covid-19, it is expected that some industrial and logistics requirements as well as a few larger land transactions will be put on hold in the short-term.
This will result in lower volumes of transactional activity in this sector during the second quarter.
"CBRE also expect to see the completion dates of new projects being pushed out by at least three months now that the development pipeline has been curtailed due to sites being closed," it added.