Just under 91,000sqm of industrial space has been occupied in the first half of 2012 – with Q2 take-up significantly higher than in the first quarter.
Take-up of industrial space in Dublin was just over 24,000sqm in Q1 and 67,000sqm in Q2, meaning 60% of the total take-up for 2011 has been achieved in the first half of 2012.
There were 20 deals completed in Q1 and 37 in Q2, a considerable increase.
The average deal size increased only marginally with all deals, except one, for space of less than 5,000sqm in size.
Fifteen of the 37 deals were for space of less than 1,000sqm each in size.
Joan Henry, Director of Research, Savills Ireland, said: “The level of take-up of space in the Dublin market industrial was surprisingly positive in Q2 with just under 67,000sqm occupied. This is the highest quarterly take-up in two years.
“The largest deal was the letting of 22,000sqm at Kilcarbery in Dublin 22 to BWG foods and this one deal contributed significantly to the overall take-up for the quarter.
While still increasing, the pace of increase in the amount of space coming to the market has eased. Given that the actual amount of space available in the Dublin industrial market, rents continue to be under downward pressure with prime rents now in the region of €40-60/sqm/per annum”.
Gavin Butler, Director Industrial of Savills Ireland, said: “In terms of the outlook for the rest of 2012, managing and minimizing void costs is set to remain a key issue as rents for tertiary premises are now being negotiated on a case by case basis – as low as €20/sqm/per annum.
Capital values remain under pressure with costs in the current market context making any speculative building un-economical. Prime capital values are estimated to be in the region of €430-645 per sqm.
“Banks are expected to continue to appoint receivers to dispose of properties and mitigate their losses. The debt serving requirements of many businesses which are exposed to the property sector will continue to bring properties to the market for the foreseeable future. Take-up is expected to be in the region of 150,000-175,000 sqm in 2012, a slightly higher forecast that at the end of Q1.”