DTZ

25 June, 2010

The emerging evidence of a recovery in the office market in quarter one has been further underwritten by the performance of the market during the second quarter of the year, according to the latest report by DTZ Sherry FitzGerald, Ireland’s largest commercial property advisory network. Take up activity in quarter two at almost double that achieved in quarter one is very positive news for the overall office market.

Commenting on the market conditions, Marian Finnegan , Chief Economist, DTZ Sherry FitzGerald noted; “The uplift in enquiry levels from the closing quarter of 2009 has translated into an uplift in occupation levels in quarter two 2010. This is best illustrated by the transition of net absorption from negative levels since quarter one 2009 to a positive net take up recorded during quarter two 2010. As such we would be cautiously optimistic that the worst is over for the Dublin office market.”

On a further positive note, the report comments the quantity of space available in the Dublin office market fell during the second quarter of the year to stand at 743,300 sq m at the end of June. Although this only represents a modest fall it marks the first reduction in the quantity of available space in over 18 months.

Further commenting on market conditions, Ronan Corbett, Associate Director, DTZ Sherry FitzGerald says “The decrease in overall availability for the first time in 18 months is testament to the improving market and shows that the pick-up in sentiment we have witnessed on the street over the past nine months is transferring into deals now. Furthermore the significant increase in the amount of reserved space and quantity of deals highlights the improving market. This trend is set to continue as the overall economy improves.”

Finally, the report notes the tightening of future supply with only 28,400 sq m under construction all of which is due to be delivered in 2010. This is the lowest level ever recorded and it comprises speculative development in the prime central business district. Given the existing quantity of stock available in the market DTZ are not anticipating significant new construction until 2012.