Back in the final years of the last century, the big property story for Cork was the imminent development of the docklands and how it was going to transform the city for future generations.
Twenty years on, after a boom and a bust, we are back in the same spo.
And, although Cork Docklands, including Tivoli, still represent the biggest urban opportunity in Ireland and one capable of transporting Cork into a 21st Century European city, there are still significant challenges that can only be solved at the highest level of government, with strong support by local representatives and other stakeholders.
Certain parts of the commercial property market are working to an extent, the obvious one being the office and hotel sectors where we currently see the first few cranes on the city horizon.
But this is driven generally by owner occupiers or large pre-lets and there is still little or no speculative development in any sector in the city centre.
The City Council has commissioned a new flood study for the Docklands, and the docklands LAPs are scheduled for the middle of next year, both of which are extremely important.
In addition, the New Vision for Apartment Living just published by the Department of Housing will provide some assistance to the design and viability issues, but much more is required in this sector to get PRS Schemes actually under construction.
A movement of the VAT rate to zero, in keeping with the UK model, is an obvious measure and should be considered for a period of time at least.
Realistically, the regional urban centres will need much more direct intervention from government if they are to meet the expectations of the 2040 National Planning Framework, which has predicted an additional 50,000 housing units for Cork over the next 20-25 years.
With apartment and high density urban living one of the major lifting blocks of the plan, we are realistically looking at another 20,000 residential housing units in Cork City Centre over that period.
So, as part of a vision for Cork, some major progress which government could certainly influence for Cork docklands and which would prove a significant catalyst for future private investment would include as follows:
- Realistic and cost effective (funded) plan around the new flood relief system for Cork city and docklands, a significant infrastructure requirement to allow any development going forward.
- Confirmation of completion of deals for the physical dockside areas, between Port of Cork and City Council, who need to control these areas going forward.
- Announcement of some relocation of a major government department to new offices in Cork city, easier to attract staff and much cheaper rent.
- Announcement of a major investment to create a university/third level education hub in part of docklands which could cater for immediate expansion requirements of both UCC and CIT, including the new proposed Business School.
The focus on offices has certainly shifted from business parks and suburbs to the city centre. This is driven by occupiers, most specifically in the FDI sector.
The developers have responded with One Albert Quay and The Capitol now completed and fully occupied with quality FDI dominated companies such as Johnson Controls and Facebook, but also longstanding Irish occupiers such as PWC and Arup.
Both these schemes were promoted by JCD Group, who are also behind 85 South Mall, currently under construction.
In the next 15 months, Cork will add 500,000sq ft of new office stock to the market including Apple Hollyhill, Lilly Eastgate (O’Flynn Construction), Block A & B, Navigation Square, and 85 South Mall.
Based on current deals and enquiries in the market all this space is already spoken for and could add an additional 3,000 jobs for the city.
All will be completed by the end of Quarter 1, 2019, and we will require the next wave of stock to take up demand from that time.
On a personal level, I must comment on Navigation Square in particular and am delighted to see this development commence construction.
The brainchild of Owen O’Callaghan, who we lost just 12 months ago, I am aware it is one which all in O’Callaghan Properties are extremely proud of and I believe all the industry wish them well and that this scheme will become a testament to Owen O’Callaghan himself and his love for his native city.
If we look at the other likely office schemes which we believe will happen in the city over the coming five years, excluding those already mentioned — HQ Horgans Quay, Anderson Quay, Custom House Quay, Trinity Quarter, Camden Quay and Sullivans Quay — we are likely to add another 1.25m sq ft of office accommodation during that period.
This only represents five years’ stock, based on average take-up figures going back over the last 20 years, and will add an additional 12,000 new jobs to the city centre.
We expect some big office announcements in early 2018 and this will bring added focus on Cork docklands and the ability to develop residential accommodation in our cities. It has to take place as our cities cannot develop a modern urban environment unless we have a vibrant community living and working there.
Obviously, suburban residential schemes will continue to be delivered but not at the levels required to meet the numbers mentioned in the National Planning Framework.
We see a very positive future for Cork, but central and local government need to be focused and progressive in terms of the infrastructure, transportation and other investment required which will provide the catalyst for private sector funding.
It can be frustrating to see all the action in Dublin over the last number of years, and although we now have opportunities, these have to be managed and aggressively pursued.
In a recent survey, Cork has emerged as a popular destination for workers in the tech industry looking for better career opportunities but also for a better work-life balance and fundamentally better quality of life.
For this to be sustained, we have to focus on providing an urban framework that caters for everyone and injects life to our city centre.