An industrial revolution
Although it costs about €100 per square foot to build warehouse and/or light industrial units, says Lisney agent, David McCarthy, sale values are “currently in the region of €45/50psf. At peak, in 2007, these types of units were selling for in excess of €200 psf.”
He says with the lift in the economy, owner-occupier demand is strong, “and these are parties who are currently renting in the sector and are keen to take advantage of competitive prices and secure their own premises.”
Cases in point are warehouse and light industrial units for sale in the Euro Innovation Park, Euro Business Park, in Cork’s Little Island district, which is long-associated with this sort of mixed use. Offered via Lisney is Unit 2, with 170 sq m, or 1,800 sq ft, of modern, semi-detached single-storey warehouse, with 6.5m eaves.
Price is €100,000, and it’s in a good position within the 20 ha Euro Business Park, off the N25 Cork/Waterford road.
Also for sale, alongside, is the larger Unit 1, which is 342 sq m, or 3,690 sq ft, with similar, 6.5m eaves of height.
It’s detached, and the price is €200,000, plus VAT. Neighbours include DB Schenker, McKenzie Cleaning, An Post, and the NCT centre.
Finally, the largest of the three Lisney warehouses new to market this week is the far larger, and more valuable, 1,134 sq m/12,215 sq ft unit about to be vacated by freight/logistics firm DB Schenker.
Ed Hanafin, of Lisney, prices this building, with two-storey office block, two front-loading doors and dock level, at €600,000, or €49 per square foot.
It’s let to DB Schenker (Ireland) Ltd until the end of 2015, with vacancy from then, when Schenker relocate to a large, high-bay warehouse facility of 80,000 sq ft at Courtstown, Little Island, acquired by the company late last year in a circa €4m deal negotiated by Mr Hanafin. DB Schenker were represented by Brendan Smyth, DTZ Sherry Fitzgerald.
- Meanwhile, a report on performance in Dublin’s industrial market was released yesterday by CBRE, who noted transactions of 86,000 sq m in Q1 for 2015, with the south-west/ N7 corridor particularly in favour, where 50% of all outstanding requirements for industrial accommodation in the capital have a preference to locate. Preference is for acquisition rather than rental, with 34 out of 48 signed industrial transactions being sales, and just 14 being lettings.
CBRE’s associate director, Jarlath Lynn, suggested the strong volume of activity in the capital’s industrial and logistics sector in Q1 was buoyed by the closing of a number of large sales in the quarter: “As a result, the Q1 take-up was considerably higher than in the same period last year. Rents also rose in the three-month period, to now stand at €70 per square metre. Demand remains strong and we are confident of strong, underlying levels of activity in this sector over the course of the coming months, helped, to some extent, by an improving domestic economy,” said Mr Lynn.
However, of the €1bn in investment sales completed in the Irish market during Q1 2015, less than 1% comprised industrial properties, according to CBRE research, who estimate that prime industrial yields in Dublin are now in the order of 6.5%.
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