The cranes are back on Dublin’s skyline and more than 30,000 staff could be accommodated in the 35 new office buildings being built in Dublin at present, according to a report by property consultants Savills. But due to the construction time lag, commercial rents in the city will continue to rise into the near future.

Over 3.5 million square feet of space is under construction, mostly situated in the Central Business Districts (CBD) of Dublin 1, 2 and 4. Approximately one third of that space is already committed to an occupier. Some development is also taking place within the boundaries of a Strategic Development Zone in Dublin’s north and south docks. With a number of planning applications in place, activity in the area is expected to increase this year.

Andrew Cunningham of Savills said: “In an ideal world, the delivery of office space would be instantaneous. However, in reality, the average timelag between planning, construction and completion is tow to three years. In the interim, rents will continue to rise. Today, prime CBD office space is being let for €55 per square foot and we expect this to rise to €65 by the end of 2016. Where rents will go after that is completely dependent on the delivery of new stock and economic conditions.”

Less Space

Savills do not foresee any decline in rents such as happened at the end of the last office build cycle: “Finance which was freely available during the last cycle is much more difficult to obtain now. This has led to a slower pickup in development and generally only the most professional developers are obtaining it. Aside from new construction, there is also a significant number of redevelopments. As redevelopments mean taking office space out of the supply chain, we are likely to end up with less space rather than more in the immediate short term.”

In Association with

Offices now under construction include Vertium, a 172,000 sq ft building on Burlington Road (pictured), due for completion in April 2017 and developed by Union Investment, U+I and Ronan Group. Numbers 32 and 40 Molesworth Street in Dublin 2 are two of four new developments under construction on the street, with number 32 is due for completion in October.

On nearby St. Stephens Green, Irish Life is expected to start a new building at Nos 69-71 before year end, while Park Developments and Target Investment Opportunities are going ahead with two buildings in South Docklands due for completion in late 2017 or early 2018. IPUT and Cosgrave are also on-site with The Exchange in the IFSC.