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Dublin

Dublin Industrial Take-Up Analysis Q4 2011

Lettings dominated the market, with sales performing poorly overall. In a tenant-driven market, occupiers are making the most out of low prices, good lease terms and incentives which are driving levels of lettings across the sector


Dublin, 10 January 2012  -  We are delighted to announce the release of our latest Industrial Research Publication: Dublin Industrial Take-Up Analysis for Q4 2011. Compiled by Jones Lang LaSalle’s Research Department, and the award-winning Industrial Agency Team, the attached report analyses take-up on a quarterly basis and provides a balanced observation on trends, rental performance and outlook.

Key findings from the study include the following:
• Total take-up between Q3 and Q4 2011 has decreased (14.1%), however yearly take-up results indicate that annual take-up for 2011 has exceeded 2010 levels by 2.5%;
• Lettings dominated the market, with sales performing poorly overall. In a tenant-driven market, occupiers are making the most out of low prices, good lease terms and incentives which are driving levels of lettings across the sector;
• There is little volume of sales activity caused by lack of availability of funding and investor confidence in the market;
• The north-south divide still very much exists as the south of Dublin continues to dominate the market, accounting for 45.5% of take-up;
• There is a large gap between modern and older stock, widened by the fall in prime rental values and the availability of modern buildings - occupiers can now choose modern stock in better locations at highly competitive levels.

Hannah Dwyer, who heads up the Research Department said “There are some good signs emerging from the Industrial stats for this quarter and 2011 as a whole which is incredibly positive for the sector. Take-up has exceeded 2010, there is increasing demand from certain sectors, and rents appear to be stabilising and are hopefully within hailing distance of the bottom. However, a two-tiered market is still very much present with good quality, well located stock dominating the market and lower end stock struggling to compete and falling into obsolescence. The fragmentation is likely to continue until refurbishment of secondary stock occurs, which in the current market is simply not a viable option”.

Nigel Healy, Director of Industrial Agency said that, “The last 12 months have, not unexpectedly, been extremely challenging and while I anticipate the coming year to be no different, I do take some comfort from the re-emergence of some new demand across certain market sectors. While undoubtedly there is an oversupply in certain locations and size categories, there are a number of occupiers looking at larger or specialist distribution facilities. If this demand were to crystallise, there will be an issue in the availability of supply”.