Dublin office space take-up doubled in third quarter

Updated / Monday, 10 Oct 2022 06:05

Dublin city centre remains the location of choice for occupiers

By Will Goodbody

Take-up of office space in Dublin between July and September was 78% higher than the average during the same period over the last decade.

According to new data from Savills, 815,000 sq ft of office space was taken up during the third quarter in the capital - double the amount in the same period last year.

It brings the total space taken up so far this year to more than the annual total last year and in 2020, when the Covid-19 pandemic was disrupting normal investment decisions.

"The activity in the Dublin Office market has picked up significantly this year following the full reopening after the pandemic," said Shane Duffy, director of office agency at Savills.

"Although nervousness remains surrounding global recession/hiring freezes, interest rates and the energy crisis, the occupational market has shown continued appetite for high quality offices as illustrated by the strong year-to-date take-up figures."

"The market is set to end the year strongly with 1.6m sq ft of stock currently reserved, although demand could ease somewhat once these requirements are fulfilled," he added.

City centre remains the location of choice for occupiers, with 80% opting for space in central locations rather than in the suburbs.

This trend has been consistent over the past four quarters.

With energy costs soaring, energy efficiency is a key consideration for tenants, driving the gap in rental values between new and older stock.

The largest letting of the quarter was A&L Goodbody's pre-let of 155,000 sq ft at 25 North Wall Quay.

That site is being redeveloped by IPUT and will increase the floor space by 36%.

The firm also took 63,000 sq ft in 3 Dublin Landings for decanting of their operations during the redevelopment of North Wall Quay in what was the third-largest deal of the quarter.

Professional services firms accounted for a third of the share of lets, with the tech sector having a quieter quarter than previously.

The second largest deal of the three month period was TikTok who signed the entire 83,000 sq ft in the Tropical Fruit Warehouse.

"Commutes are becoming busier with a 10% increase in public transport journeys in the past month alone, according to the CSO, which represents a positive picture for office occupancy levels," said Mr Duffy.

"As the winter months roll in, coupled with the looming energy crisis, there is potential that employees will be prompted to work from the office more often in order to offset energy bills at home," he added.