Dublin’s office vacancy rate reached an 11-year high of 16% at the end of 2023, as hybrid working continued to impact demand. However, Lisney, a property consultancy firm, believes that sustainability will be a major driver of market shifts in 2024.
“The European Union has already set ambitious targets for achieving climate-neutral building stock by 2050,” said James Nugent, Senior Director at Lisney. “This is a particular problem for office buildings some of which are at risk of becoming ‘stranded assets’ because they are too modern to financially justify upgrading works but are not meeting required standards.”
Nugent also noted that the planning and development legislation that is being enacted this year is expected to “speed up the process” for development land. This could help to alleviate the pressure on the supply side of the market.
In the residential property market, Lisney predicts that a lack of supply and sale delays will continue to stymie activity. The report also called out the Probate Office for causing uncertainty for buyers, as a grant of probate is now taking 22 weeks from lodging.
Despite these challenges, Lisney remains optimistic about the future of the commercial property market in Dublin. “The market is in a better position going into 2024, following several challenging years,” said Aoife Breannan, Research Director at the property company.
Here are some of the key takeaways from Lisney’s 2024 outlook for the Dublin commercial property market:
- The office vacancy rate is expected to remain elevated in 2024, but demand is expected to gradually pick up as more staff return to the office.
- Sustainability will be a major driver of market shifts, as investors and occupiers increasingly demand buildings that meet ESG standards.
- Interest rates are expected to continue to rise, which could put upward pressure on rental prices.
- The residential property market is expected to continue to be challenged by a lack of supply and sale delays.
Overall, Lisney believes that the Dublin commercial property market is facing several challenges in 2024, but there are also some positive signs. The market is expected to gradually recover as demand returns, and sustainability is becoming a more important factor for investors and occupiers.
Source: Buisness Post
