Irish investment reaches 2008 levels as demand outstrips supply (IE)

The Irish investment market has seen transactional volumes at €130 million in H110, considerably higher than the €85 million recorded in H109. Savills predicts that if the deals that are currently in negotiation complete this year that annual turnover could be close to 2008 levels at €750 million.

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 Q110 and yields are stabilizing 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, says: "There are signs of life in the investment market with demand now outstripping supply for prime opportunities and prime yields are stabilizing. However transactions are taking significantly longer to complete."

Savills report states that approximately 10 deals are currently agreed and if completed in the third quarter would bring the total transaction turnover at end Q310 to €600m. Furthermore the firm estimates that in terms of supply there is still circa €250 million 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.

Source: Savills

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