More than one in eight property investment deals in the last three months were valued at €50m at least, a new report reveals, writes Ayaat Yassin-Kassab.
In July, August and September, investment activity reached €591m – the highest level recorded in 18 months, according to agents Sherry FitzGerald.
Total turnover for the first nine months of the year stood at almost €1.3bn.
The report said: “Retail remained the dominant sector bringing in the most sales at 33% and the three-month period also saw the first significant Purpose Built Student Accommodation (PBSA) transaction in two years,” the report said.
This sale, Scape’s 299-bedroom property on Stephen Street, Dublin 2, was for an estimated €80m.
But residential spend remained low, representing just 8% of total turnover.
The remainder of the year looks promising, with a number of large asset sales expected to close in the coming months, it added.
The retail sector will continue to attract the lion’s share of investment but uncertainty over potential Government intervention in the residential market is likely to persist in the run up to the general election.
The domestic-facing sectors expanded by 2% in the first half of 2024, compared to the corresponding period in 2023.
The multinational-dominated sectors decreased by 12.3% over the same period.
Gross Domestic Product – the monetary value of a market’s goods and services – is expected to fall again this year before rising in 2025.
The labour market continues to see record levels of employment, with the total number of people aged 15-89 in work reaching 2.75 million in April, May and June.
This represents a rise of 71,500 people since the same time last year placing Ireland near full employment.
The unemployment rate for 15-74 year olds stood at 4.6% in the April to June period, up from 4.4% a year earlier.
The annual eurozone inflation rate fell to 1.7% in September. This was less than the rate recorded at the same time last year and under the European Central Bank 2% target rate.
This period saw continued improvement in transactions within the Irish investment market, with sales reaching €591m.
This is up 26% from the same period last year, and as a result, total investment in the year to date reached almost €1.3bn.
Although this is 13% lower than the same period in 2023, this is due to the record low level of investment during the first months of the year.
Turnover in the last six months was 37% greater than the same period of 2023.
A significant 44% of transactions in the July to September period were valued at €20m or more, well ahead of the long-term quarterly average of 26%.
A substantial 13% of sales of more than €50m included The Square Shopping Centre in Tallaght for around €130m.
A further 31% of transactions ranged between €20m and €50m, more than double the long-term average for this price cohort.
However, the sales in the €1m to €10m range dropped to 39%, well below the long-term average of 62%.
Another significant transaction during the three-month period was the off-market acquisition of Blackpool Shopping Centre in Cork for an estimated €49.5m.
This brings retail spend for the first nine months of the year to €407m, accounting for 32% of total turnover.
This already exceeds annual retail spend seen over the past four years.
This year looks set to be the highest level of spend recorded for the sector since 2016 if the agreed sale of Blanchardstown Shopping Centre for around €600m closes by the end of the year.
The shopping centre was last sold in 2016 for €950m.
Cork saw 8% of profit from the sale of Blackpool Shopping Centre, while the remaining 1% was spread across a number of locations.
Total investment in the Dublin region was €894m in the first nine months of the year, or 70% of total turnover.