While investment transactions are down year-to-date compared with 2016, activity is expected to increase in the second half of 2017, putting total volume in 2017 closely into line with the ten year average at around €2bn.
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A shortage of supply of sizeable assets being brought to the market meant that activity in the first six months of the year was driven by smaller transactions.
The office sector accounted for a third of total volume at €259.6m. The majority of this activity took place in Dublin but other notable deals included the €20m Ericsson Facility in Athlone and the €11m Block B building at Bray Civic Centre in County Wicklow.
Dalata’s €62.5m acquisition of The Clayton Hotel in Dublin 2 and Clarion Hotel in the Liffey Valley also provided a significant boost to the leisure and alternatives sector.
Paddy Brennan, head of capital markets - Ireland said: “The main barrier to volume in the first half of 2017 has been a lack of good quality assets coming to market however this is changing and there is now a list of great properties for investors to choose from. These include The Square Shopping Centre in Tallaght, Gibson Hotel in Dublin and the Department of Justice headquarters at 94 St Stephen’s Green.
“Investors’ appetite remains robust and we anticipate a positive outlook for the remainder of the year and into 2018 for the commercial property market. The Irish economy is continuing to strengthen and the number of cranes on the Dublin skyline has doubled in the past year, a sure sign of investor confidence. For the fourth year running Ireland is the fastest growing economy in Europe. Foreign investment is flowing and consumer confidence is continuing to improve. Britain’s exit from the EU presents a unique opportunity for Ireland and we believe that property investment will receive a boost in the coming months.”