Park Kicks Off €35M Ballycoolin Logistics Scheme After Sector's Bumper Take-Up In Q3
Park Developments has started work on the first of six new logistics units on a 14-acre site at Northwest Business Park in Ballycoolin, Dublin 15, as take-up and rents in the sector surge.
The 50K SF facility will include 4K SF of offices. With an internal height of 49 feet, it will have five loading bays, two ground level roller shutter doors and a yard depth of over 120 feet.
Planning permission was granted in August 2017 for 233K SF across the six buildings, with unit sizes ranging from 14K SF to 78K SF. Park is planning to spend €35M on building out the scheme.
This initial building, Unit 629, will be ready for occupation by summer 2019 — either for an annual rent of €475K or a €8.6M purchase price.
Park’s previous developments in the industrial and logistics sector include the M50 Business Park in Ballymount, Northwest Business Park in Ballycoolin and Northern Cross Business Park in Dublin 11.
Unit 629 is the company's first industrial spec build since the crash.
Park Developments Group Director Dick Cuddihy said the logistics sector has seen strong interest from occupiers in the retail and parcel delivery sectors due to a surge in online sales. “This, combined with an all-time low vacancy rate of 3.2% in Dublin and continued growth in the more traditional sectors, means there has never been a better time to re-enter the logistics development market,” he said.
According to CBRE figures the Dublin industrial and logistics market saw over 1.07M SF of take-up during Q3 2018 through 39 individual deals. Total take-up in the sector for the first nine months of the year was 2.26M SF.
“This is 24% higher than the volume of activity achieved in the first nine months of 2017 demonstrating the impact that new supply is now starting to have on the industrial and logistics sector,” CBRE Executive Director and Head of Research Marie Hunt said.
Almost two-thirds (64%) of the volume of take-up in Dublin in Q3 was through 26 leasing deals, with the remainder comprising sales.
CBRE said prime industrial rates in the capital reached €9.85/SF at the end of the quarter, up from €9.50/SF at the end of Q1. The agency expects prime rents to rise further over the coming months.
Over half (52%) of Q3’s activity involved deals of 100K SF plus, with a further 26% of take-up being spaces of between 20K SF and 50K SF.
These figures represent something of a turnaround from Q2, when 561K SF transacted across 47 deals, 68% of which involved spaces of less than 10K SF.