Irish investment in H1 reaches 2008 levels: Savills

The Irish investment market has seen a total transactional volume of EUR 130 mln in the first half of 2010, considerably higher than the EUR 85 mln recorded in the first six months of 2009. Savills predicts in a investment report that if the deals that are currently in negotiation complete this year that annual turnover could be close to 2008 levels at EUR 750 mln.

The report shows that in terms of type of asset, office properties have dominated turnover and this is reflected in yields which have remained at 7-7.25% for prime stock. Furthermore retail transactions dominated Q1 2010 and yields are stabilising at 6-6.25% but with a lack of industrial transactions since year end 2009, yields stand at 8.5-9.0%.

Joan Henry, head of research for Savills Ireland, said: 'There are signs of life in the investment market with demand now outstripping supply for prime opportunities and prime yields are stabilising. However transactions are taking significantly longer to complete.'

The Savills report states that approximately ten deals are currently agreed and if completed in the third quarter would bring the total transaction turnover at end Q3 2010 to EUR 600 mln. Furthermore the firm estimates that in terms of supply there is still circa EUR 250 mln of stock available in the market which is not currently under offer, however the majority of this is non prime assets for which there is currently poor demand. Demand for prime assets is exceeding supply and so any stock that does come to the market in this category will see good levels of interest.