The economics of Irish commercial property right now is simple but factors are pointing in the opposite direction. Photograph: Alan Betson. The sun was out, it was warm for September, and miraculously dry. Weaving from the heart of the old city around the Castle, Parliament Street and Dame Street down to the river at O’Connell Bridge and on down the quays, allowed me to take in Dublin’s commercial property stock. I could see the three main eras of building – almost walking through time.
The Crony Era offices were built by the first wave of upwardly mobile property developers in the new State, the so-called “Men in the Mohair Suits”. These developments were largely the result of sweetheart deals between politically connected developers and their friends in government. Surprise, surprise, built on the sites of torn-down Georgian gems, these offices were leased to government departments and national banks.
What binds these architectural styles, various epochs and their contributions to the Dublin skyline is that they are all going to crash. If Irish office prices were low, things wouldn’t be so bad – but they are not. Prime rental levels in Dublin are about €700 per sq m – among the highest in the euro zone. The city is flooded with new space. According to CBRE’sfor the Irish market, “approximately 216,000 sq m of under-construction office stock is expected to reach practical completion in 2023 and this will grow the total size of the Dublin office market to over 50 million sq ft”.