Rents Up Despite Slow Quarter For Dublin Industrial And Logistics
Activity in the Dublin industrial and logistics market remained “solid if unspectacular” in Q3 with a total of approximately 662K SF taken up across a mix of 31 leases and sales, according to agent Cushman & Wakefield.
On a rolling 12-month basis, Dublin take-up stood at approximately 2.9M SF at the end of Q3, a step down in pace compared to longer-term average absorption trends for the Dublin market, Cushman said in its latest report.
The top five leases accounted for approximately 70% of Dublin space leased in Q3, notably nearly 80K SF taken up at Magna Business Campus in Citywest, 66K SF at Park West and just under 55K SF at Horizon Logistics Park.
In the transactional market, the biggest deals included the sales of units at Grange Way Baldoyle Industrial Estate, the former ABB facility at Belgard Road Tallaght and Ballyboggan Road Dublin 11.
Supply across the Dublin market remains constrained, Cushman said. The overall availability rate hit 5.1% in Q3, slightly down from 5.5% in Q2. Excluding stock already reserved, the vacancy rate is just over 3%.
The continued tight supply picture, together with still-robust demand, has supported higher rents through 2023, and this quarter the agent upgraded its prime Dublin rent forecasts to €12.26 per SF.
Approximately 1.6M SF was under construction at the end of the quarter, which “barely meets annual demand,” even based on the more modest take-up trends identified in Dublin, the company added.
That is in part because approximately 69% of that space is either reserved or pre-let, underlining what Cushman described as a “positive demand picture” across the Dublin market.
“Take-up in the Dublin market has moved to a somewhat slower beat so far in 2023 compared to long term averages as global economic uncertainties have rumbled on through the year,” Cushman & Wakefield Head of Industrial & Logistics Brendan Smyth said in the report. “That said, we continue to see steady demand across the industrial and logistics sector and that demand, combined with a very tight supply picture, has contributed to gradual increases in prime rents as we have moved through 2023.”