Latest research from JLL, which tracks the Dublin office market, indicates that take-up of space in the Irish capital in Q4 2021 was over 900,000 ft2 (83,600 m2), a threefold increase on the same period in 2020.
The bouyant fourth quarter brings the year's take-up to 1,590,000 ft2, with the tech, media and telecommunications (TMT) sector continuing to be the top performer with 27% of all leases signed.
The two largest rental deals in the fourth quarter, signed by Tik-Tok and KPMG, represent 56% of all take-up of the market. Both deals exceeded 200,000 ft2 in size, with KPMG committing to a new 20-year straight lease with their new campus at Harcourt Square due to be delivered by Hibernia REIT in 2026.
There was an 80:20 split in favour of city centre office space over the suburbs.
On the supply side, the vacancy rate is 10.8%, down from 12.4% at the end of Q3 2021. There are 4.8 million ft2 under construction or refurbishment, with 2.5 million ft2 of this space due to complete in 2022.
Office accommodation that is available by way of sub-lease or assignment, known as grey space, continues to be an important facet of the market and represents over a quarter of all available accommodation by the end of 2021. There is what JLL describes as a 'healthy' 748,000 ft2 of deals already reserved, agreed but not yet signed, as we move in 2022.
Neill Mc Nicholas from the JLL tenant rep team commented: '2021 will be remembered as a year of two halves for the market. The first half, providing a very challenging business environment with government restrictions and construction site closures.
'In the second half, an increase in vaccinations led to the lifting of government restrictions and a cautious return to the office for most occupiers. The statistics follow this sentiment with Q1 performance representing the lowest quarter of take-up ever recorded in the Dublin market.
'However, we now close out 2021 with strong take-up of 900,000 ft2. We move into 2022 on an optimistic footing with a further 748,000 ft2 of deals already reserved, the majority of which should sign early in the New Year.
'On a note of caution, a return to more stringent government restrictions or international travel limitations presents may hamper the market.'
