Galway has lowest office vacancy rate in the country
The lack of supply of good quality office space is continuing to constrict the market in Galway City.
New research has found that Galway has the smallest office vacancy rate of any city in Ireland, at 8.4% – this compares to Cork at 11.6%; Dublin at 12% and Limerick at 17.9%.
According to a report on the country’s office market from Cushman & Wakefield (the commercial arm of Sherry Fitzgerald), activity in the city was “subdued” in the first three months of this year, due to the shortage of supply.
“The opening quarter of 2017 saw another subdued period of leasing activity in the Galway office market, impeded by the persisting supply/demand imbalance which is taking place in the market at present,” the report reads.
The take-up activity in the first quarter was by OpenJaw Technology of 750 square metres in Galway Technology Park in Ballybrit and 300 sq m taken by AIB at the IDA Business Park in Dangan.
“Total supply levels in Galway edged upwards by 2% in the first quarter of 2017, to stand at 25,400 sq m. This was as a direct result of a larger volume of secondhand space being brought to the market during the summer than was taken up,” it reads.
It adds that availability levels have been rising steadily over the past year – however, the majority of this is ‘Grade B’ space or building stock which is only completely to shell and core level.
There is “an acute shortage of Grade A space persisting in the market,” the report reads.
The research points out that just one office project began construction during the first quarter – the redevelopment of the City Limits complex in Oranmore – which will become around 6,500 sq m of space for around 440 workers.
It predicts that prime rents in Galway’s office market will rise from €250 to €300 per square metre per annum by the end of the year, and are likely to jump to €340 in 2019.