Savills: Take up of logistics space in Dublin down 44%

Updated / Monday, 19 Apr 2021 13:43

The figures show the southwest of Dublin accounted for the largest share of take-up, accounting for 69% of take-up in the first quarter

38,000 sqm of industrial and logistics space was transacted in Dublin during the first quarter of this year, down 44% on the five-year quarterly average, according to new research from property advisor, Savills Ireland.

However, Savills said this is not a reflection of reduced demand, rather it is due to a lack of space in the market with the vacancy rate standing at an all-time low of 1.2% at the start of the first quarter.

In total, there were 17 transactions, only six of which were sales reflecting the continuing lack of freehold opportunities available on the market.

The figures show the southwest of Dublin accounted for the largest share of take-up, accounting for 69% of take-up in the first quarter.

Gavin Butler, Director of Industrial and Logistics in Savills said the lower than normal take up in the first quarter has been "severely hampered" by a lack of supply.

"94% of the speculatively built stock that was brought to the market in 2020 was let prior to completion which is evidence of the current pent-up levels of demand.

"Brexit has also increased demand since the beginning of the year as UK based occupiers, whose supply chains into Ireland come through the UK, are looking to establish operations in Ireland to avoid costs and delays getting product through the ports," he said.

Looking ahead, Savills said it expects take-up for the rest of the year to be strong, with 130,000 sqm of space due to be delivered in 2021 across eight developments.

It said 30% of this space is already committed, with a further 50% in advanced stages of negotiation.

Savills said that based on current levels of existing requirements and the continued demand for logistics space arising from Brexit, it is expected that the majority of this space will be taken up prior to completion.