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Investor Guide to Europe 2014
The Irish investment market is relatively small
and has historically been dominated by domestic
investors. The market has suffered in the wake of
the global financial crisis.
Following the swift action to create a Bad Bank in the form
of nAMA, the write down of loans and sharp re-pricing, the
Irish market is now witnessing a strong recovery, underpinned
by increased occupier demand, favourable policy measures
and improving economic sentiment. This is also supported by
growing interest from overseas investors, including the Uk,
USA and global opportunity funds.
The Irish market is dominated by Dublin, which represents
the bulk of investment activity, focussed on office, retail and
mixed-use schemes. The strength of transaction activity has
been characterised by a number of large sales and portfolio
sales, most notably, the Project Arc and Ulysses Portfolio. In
addition, there has been a noticeable increase in office market
investment activity.
The market has been dominated by private investors and
companies along with institutional investment. The listed
sector has been relatively small. However, legislation to create
REITs came into effect in 2013, since when Green REIT and
Hibernia REIT PlC have been launched to the market.
The supply of bank finance remains a concern, but has
improved in 2013. lending remains deal and borrower specific.
The extension of the capital gains tax window for investors
to December 2014 and low bank deposit rates should see
further entrants to the market as investors look for alternative
investments to inflation proof their capital.
Market sizing
Ireland
Europe
Invested stock*
(Total stock)
EUR 50bn
(EUR 70bn)
EUR 3,380bn
(EUR 8,150bn)
liquidity ratio*
(10y average)
2.6%
(2.0%)
4.0%
(4.5%)
2013 volumes
(10y average)
EUR 1.3bn
(EUR 1bn)
EUR 139bn
(EUR 135bn)
Investment activity by asset type, 2013
Source : DTZ Research
Investment activity by source of capital, 2013
Source : DTZ Research
Market pricing – Dublin (Q4 2013)
office
Retail
Industrial
Current Yield
5.75% 6.00% 8.50%
Min/Max
(10y)
4.00-7.50% 2.50-6.50% 5.50-9.25%
Yield
definition
net initial yield
Source : DTZ Research
IRELanD
* 2012 figures
