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DUBLIN IRELAND OFFICES QUARTER 2 | 2019
2 31
Q2 TAKE-UP H1 TAKE-UP
350,000 SQ FT 1.75M SQ FT
PRIME
QUOTING RENTS VACANCY
Q2 2019 | Dublin Office Market
Colliers International
Colliers International
Q2 2019 | Dublin
€65 PSF PER ANNUM 6.5% OVERALL
Ireland Office
Snapshot
Market
MARKET TRENDS
Flexible Workspace Operators
»» WeWork continue to expand and currently have seven locations in Dublin
»» WeWork now aggressively pursuing “HQ model” to attract larger occupiers
»» Currently Microsoft, Facebook, Accenture, Ernst Young (EY), and Wells Fargo all
occupy flex space in Dublin
»» All global flex space operators now in the Dublin market
Dominant Technology, Media and Telecom (TMT) Sector
»» Over 50% of total take-up in last 12 months
»» Facebook, Google, and Salesforce represent 40% of 2018 take up
»» Occupiers tend to sign leases in advance of expansion and have created a
submarket of short-term fitted space with plans for expansion
»» Moving towards campus environments - Microsoft, Facebook, Salesforce, and
Indeed
»» Strategic expansion into the suburbs - Google and Facebook
»» New wave of TMT companies establishing large footprints in Dublin - Stripe,
Slack, Hubspot, Intercom, Dropbox, DocuSign and Workday
Brexit Impact
»» Currently not having a significant effect on take-up
»» IDA Ireland reports 40+ Brexit related enquiries; most deals less than 5,000 sq. ft.
»» Currently too much uncertainty
4
TAKE-UP HISTORICAL OFFICE
TAKE-UP
5
3
»» Q2 2019 take-up - 350,000 sq. ft. across 40 deals
»» Overall H1 2019 take-up - 1.75 million sq. ft. 4,500,000 3.9M
»» TMT continues to be dominant sector - 50% of take up year-to-date 4,000,000
»» State is now a major player in the market 3.1M
Q2 2019 | Dublin Office Market
Colliers International
Colliers International
Q2 2019 | Dublin
3,500,000
3,000,000
Ireland Office
2M
2,500,000
SUPPLY
1.75M
Snapshot
2,000,000
Market
1,500,000 900k
»» Speculative development continues to be delivered on a phased basis
1,000,000
»» Current requirements suggest another strong year is in prospect (1.2 million square feet
of space is currently reserved) 500,000
»» 50% of stock under construction is pre-committed 0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 H1 2019
TOTAL STOCK 43 MILLION SQ. FT.
2018 2 million sq. ft. Completed
2019 2 million sq. ft. Due for completion
2020 2 million sq. ft. Due for completion
2020+ 4 million sq. ft. With planning or in planning process OVERALL DUBLIN
HISTORICAL VACANCY
23%
25.0%
VACANCY
20.0% 16%
»» Overall Dublin vacancy rose marginally in Q2 from 6.3% to 6.5%
15.0% 11%
8%
10.0% 6.5%
5.0%
5%
CITY CENTRE
8%
SUBURBS
6.5%
DUBLIN OVERALL
0.0%
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Q1 2019 Q2 20196
RENTS HISTORICAL AVERAGE CITY
CENTRE QUOTING RENTS
5
7
»» Prime quoting city centre rents vary from €60 to €65 per sq. ft. per annum and have
€65
stabilised over the past 12 months €63
€ 70
»» Larger pre-lets tend to be negotiated at lower rents (€57 to €62 per sq. ft. per annum) €58
€ 65
which shows Landlords are willing to negotiate better terms to de-risk speculative
developments € 60
Q2 2019 | Dublin Office Market
Colliers International
Colliers International
Q2 2019 | Dublin
»» Rents have effectively doubled in the city centre since 2013, while prime suburban rents € 55
remain steady between €25 to €32 per sq. ft. per annum € 50
€40
Ireland Office
€ 45
Snapshot
€ 40
€29
Market
LEASE TRENDS
€ 35
€ 30
€ 25
»» Landlords are seeking long term commitments on new space in city centre € 20
2012 Q1
2012 Q2
2012 Q3
2012 Q4
2013 Q1
2013 Q2
2013 Q3
2013 Q4
2014 Q1
2014 Q2
2014 Q3
2014 Q4
2015 Q1
2015 Q2
2015 Q3
2015 Q4
2016 Q1
2016 Q2
2016 Q3
2016 Q4
2017 Q1
2017 Q2
2017 Q3
2017 Q4
2018 Q1
2018 Q2
2018 Q3
2018 Q4
2019 Q1
2019 Q2
»» 25 year leases with first breaks at years 12 to 15 are now the market norm
»» Rent free incentives range from 3 to 9 months, contradicting the requirements of new
TMT entrants, which has fueled the explosion of flex space operators
»» Limited supply of short-term “plug & play” space. Established TMT companies have
future-proofed space not immediately required and sub-let floors back to the market on
short term deals.
»» Currently 300,000 sq. ft. of space is available on the market for sub-lease
»» In suburban space, more flexibility is achievable, however the premium suburban
Landlords are seeking 10 year leases with incentives ranging from 6 to 9 months rent
free DUBLIN RENTS
»» Leases of 10 to 15 years with options to extend are now entering the market due to new BY AREA
Global Accountancy rules
LOCATION PER SQ FT. PER ANNUM
NOTABLE H1 2019 DEALS
Prime CBD €60 - €65
OCCUPIER SQ. FT LOCATION
Facebook 170,000 South Suburbs North Docks €50 - €60
Salesforce 430,000 North Docks
South Docks €55 - €60
OPW 210,000 City Fringe
Central Bank 200,000 North Docks North Suburbs €18 - €33
Docusign 100,000 South Docks South Suburbs €22 - €32
Paddy Power 50,000 City Fringe
West Suburbs €16 - €28CONTACT US
PAUL FINUCANE
Director | Business Space
Direct +353 1 633 3724
paul.finucane@colliers.com
NICK COVENEY
Director | Business Space
Direct +353 1 633 3736
nick.coveney@colliers.com
MICHAEL DONOHOE
Director | Corporate Solutions
Direct +353 1 633 3733
michael.donohoe@colliers.com
CIARÁN O’CONNOR
Surveyor | Business Space
Direct +353 1 633 3757
ciaran.oconnor@colliers.com
This report gives information based primarily on Colliers International data, which may be helpful in Hambleden House
anticipating trends in the property sector. However, no warranty is given as to the accuracy of, and no liability
for negligence is accepted in relation to, the forecasts, figures or conclusions contained in this report and they 19–26 Lower Pembroke Street
must not be relied on for investment or any other purposes. This report does not constitute and must not be Dublin 2
treated as investment or valuation advice or an offer to buy or sell property.
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