5 Things to know about the Commercial Property Market
The recent introduction of Level 5 restrictions in Ireland is expected to dampen Commercial Property activity levels as we enter the business end of the year.
The real impact of the Pandemic on the Commercial Property Market will unfold early next year, however as the market evolves and adapts, we list five things worth knowing about the current market.
1) Prime Industrial Warehouse and Logistics is one of the best performing sectors with further capital and rental growth expected during 2021 on the back of limited supply and increasing online retail sales. Prime Rents now achieving c €113 per sqm and rising depending on size and ratio of Warehouse to Office space.
2) Market continues to benefit from International investor demand for Private Rented Sector (PRS) and prime Office investments both on and off market. The recent sale of the Grade A, Office Investment at Baggot Plaza, Dublin 2 by Kennedy Wilson to Deka Immobilien for c £127 million, reflecting an initial yield of 4% is a timely market boost.
3) The Private Rented Sector and Office Investment markets are expected to dominate activity in the Irish Investment Market during 2020. Market expectations for total Investment turnover of close to €3 billion, would be a good result during these testing times.
4) Retail dichotomy to continue, with the traditional High St model continuing to struggle and the more resilient Retail Park model performing better for Retailers and Investors. Interesting to see John Lewis in London obtaining permission to convert over half of its Oxford St department store into Office space recently. Expect further Click & Collect services and adaptations in this sector.
5) Digital transformation and changes in the way we work and spend online will continue to accelerate changes within the Commercial Property market, leading to more efficient and transparent transactions.
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