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Total capital invested in Irish property projected to exceed 2017 levels

“2017 was another dynamic year for Irish property. Activity in the residential market intensified to €14.4bn, recording a significant uplift in transactions on the previous year, while a prosperous economic environment and continued robust occupier markets saw Irish commercial assets remain attractive to both domestic and overseas investors.”  Marian Finnegan, Chief Economist, Cushman & Wakefield.

This latest report from Cushman & Wakefield Research is a unique analysis, which endeavours to capture the total capital flow into the entire Irish property market. This analysis distinctively also captures smaller-sized transactions and provides a county by county breakdown of capital inflows.

The report reveals that an exceptional €17.9bn transacted across both residential and commercial property during 2017, representing a 1% increase on the previous year.

This was strongly driven by an increase in capital targeting the residential market, which increased by 24% year on year. The residential sector was the greatest beneficiary of a rise in capital investment during 2017 and accounted for 80% of the total spend. It is also worth noting that every county in Ireland experienced an increase in residential transaction activity in 2017, in fact, double-digit growth was recorded in all but three counties nationally.

In contrast, the total investment in commercial property fell to €3.5bn. The reduction was largely due to the smaller number of big ticket investment opportunities on the market during 2017. That said, the volume of deals recorded remained very robust and well above long term trends.

As usual, the lion’s share of overall capital flow remained concentrated in the capital with a total of €9.9bn invested in Dublin. However, Cork did enjoy a very significant uplift in both residential and commercial activity, rising to €1.6bn in the year. This compared to €681m invested in Galway and €405m in Limerick.

Looking at the current year, Ms Finnegan commented; “2018 looks set to be another solid year for investment in the property market. Commercial investment alone for the first half of the year is significantly higher than the same period last year. Notably, led by a number of larger value transactions and an uplift in overall development land transactions, the commercial property market looks set to exceed 2017’s performance.”

Growth in the residential sector is also set to continue in 2018 with a 12.5% uplift already recorded in the volume of home purchases annually to Q1 2018, according to the Property Price Register.

Furthermore, turnover in the Private Rented Sector (PRS) has also increased considerably in the opening half of 2018 compared to the same period last year. Buoyed by a positive economic outlook, a growing population and strong residential rental growth, momentum for institutional investment in residential properties is expected to continue unabated for the latter half of 2018.

 

About Cushman & Wakefield

Cushman & Wakefield is a leading global real estate services firm that helps clients transform the way people work, shop, and live. Our 43,000 employees in more than 60 countries help investors optimize the value of their real estate by combining our global perspective and deep local knowledge with an impressive platform of real estate solutions. Cushman & Wakefield is among the largest commercial real estate services firms with revenue of $5 billion across core services of agency leasing, asset services, capital markets, facility services (C&W Services), global occupier services, investment & asset management (DTZ Investors), project & development services, tenant representation, and valuation & advisory. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter.

Cushman & Wakefield is the commercial partner of the Sherry FitzGerald Group in Ireland.

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