Commercial property consultants CBRE have released figures for final investment spend data for the Irish commercial property market for the first three months of 2013.
They indicate the momentum experienced in this sector during the last six months of 2012 has continued into this year. More than €336 million of investment properties were sold on the Irish market in the first three months of the year.
Twenty-one transactions were completed during Q1 on the Irish market. This level of activity compares to the €545 million invested in Irish real estate in 2012 and is higher than the amount invested in each of the three previous years.
Notable transactions completed during the past three months include the sale of the Bishop’s Square office building in Dublin 2 to King Street, a US investor, for €65 million, the sale of four office buildings in the Irish Airlines Pension Fund and the sale to German fund GLL of two adjoining buildings on Grafton Street for €40 million. Over half of Irish investment properties worth more than €1 million sold in Q1 of 2013 were offices.
The percentage breakdown of transactions is as follows:
Office 51%
Industrial 2%
Retail 13%
Mixed 15%
Other 19%
The demand for prime properties in the Irish market is continuing to have a positive impact on yields. CBRE intends to adjust its prime yield series in April to reflect investors’ appetite for prime real estate. CBRE says that prime office yields in Dublin are approximately 6.5 per cent, while prime high street retail properties are yielding about 5.75 per cent.
Caroline McCarthy, the Executive Director and Head of the Capital Markets team at CBRE, Ireland, said, “Improving economic conditions coupled with the availability of attractively priced real estate in Ireland is continuing to attract significant overseas appetite and this is fuelling the investment sector and leading to some price rises for prime properties.
“A number of the assets that signed during Q1 were brought to the market several months ago so at this juncture, we need to see more prime property assets being released for sale to satisfy current volumes of demand”.
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