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No Huge Office Letting Deals In Q3 But Very Strong End Of Year Expected

Three Park Place, Upper Hatch Street, Dublin

More than 600K SF of office lettings were signed in 80 individual transactions during the third quarter, according to CBRE figures.

This brings take-up for the year to date to over 2.35M SF in Dublin. And a further 1M SF was reserved at the end of September.

CBRE said the volume of office lettings agreed so far in 2018 indicate that the market is on track for another strong year, following a record breaking 2017 when take-up in the capital exceeded 3.55M SF.

Large deals agreed during the three months to September included Google taking 58K SF at One Grand Canal Quay and Kellogg signing up to nearly 38K SF at DAA’s Dublin Airport Central on a 20-year lease.

Transactions signed in the first half of the year included LinkedIn taking 152,500 SF at IPUT's One Wilton Place; IDA Ireland agreeing to lease 112K SF at Three Park Place; and WeWork taking 73,500 SF at Central Plaza and 50K SF at 5 Harcourt Road.

CBRE said lettings to tech tenants accounted for 34% of take-up in Dublin in Q3 and more than 40% of leasing activity so far this year.

The agency said rents for prime office space in the city centre have levelled out at €65/SF, while those in the south suburbs of the city are currently at €28.50/SF but are expected to increase over the coming months.

“The first two quarters of 2018 saw strong volumes of leasing activity being recorded in the capital and this momentum carried into Q3 although, unlike the previous two quarters, there were no large transactions extending to more than 100K SF signed in the last three month period,” CBRE Executive Director and Head of Research Marie Hunt said.

“Nevertheless, there is currently more than 1M SF of office accommodation reserved and demand is running at more than three times that level, which points to a very strong Q4 and continued momentum into 2019,” she said.

Hunt also noted that over a third of take-up in Dublin in the year to date has been made up of pre-lettings.