Dublin's industrial and logistics property take-up fell 58%, says Savills report

Savills Ireland says vacancy rate remains low at 1.8%

Dublin’s industrial and logistics property market saw its lowest take-up in a decade in 2024, a report by Savills Ireland said.

Dublin’s industrial and logistics property market saw its lowest take-up in a decade in 2024, a report by Savills Ireland said on Monday.

Take-up across the capital’s industrial and logistics market reached 745,000 sq ft in Q4 to bring the total for 2024 to 1.3m sq ft. This represents a 58% decline compared to 2023, according to Savills, and was the lowest take-up since its series began in 2014.

There were just 31 deals in this sector in 2024, resulting in an average deal size of 42,700 sq ft. However, this is distorted by a single transaction of 290,000 sq ft.

The fall in take-up was driven by a decline in the transactions of big-box units sized 50,000 sq ft or more. The number of big-box deals declined by 71% in 2024, representing a decrease of 1.5m sq ft in comparison to 2023.

The largest deal of the year occurred in fourth quarter with the pre-construction purchase of 290,000 sq ft at Drake House in Dublin AirPort Logistics Park. This was followed by the letting of 103,800 sq ft at Belgard House to Chemist Warehouse and the 96,500 sq ft letting of Building 1 in the M50 Logistics Hub to Jysk.

Dublin’s vacancy rate remains low at 1.8% as a drop in take-up was offset by low delivery of vacant completions.

The vacancy rate of 1.8% is marginally higher than the 1.7% recorded at the end of 2023. This was driven by existing stock becoming vacant rather than new supply. However, 235,000 sq ft of vacant space was made available through sublet or assignment. This includes the largest addition to vacant stock of 178,000 sq ft at Unit 3 Quantum Distribution Park.

The report said 83% of vacant units are legacy stock constructed in the 90s or earlier. Notably, the average size of legacy vacant stock is just 21,000 sq ft. Comparably, the average size of modern vacant units is 84,000 sq ft. The lack of transactions in prime industrial and logistics units saw prime rents remain unchanged over the course of 2024 at €13.00 per sq ft. With 1.7m sq ft scheduled to complete this year, prime rents are expected to rise during the course of 2025.

“Our prime rents which are based on best-in-class new build industrial and logistics facilities are expected to rise to €14.00 per sq ft in 2025 as transaction volumes increase with new supply,” said Savills Ireland director of industrial and logistics Jarlath Lynn.

The report predicts upward movement in rents will be driven by high demand for best-in-class facilities, including environmental, social, and governance (ESG) requirements. The expansion of the EU Corporate Sustainability Reporting Directive is helping to drive occupiers, and their suppliers, towards best-in-class stock. Savills forecasts an undersupply of high-quality units, combined with strong occupier demand, to continue to push prime rents upwards.