SCSI/IPD Ireland Q3 2013 report is out for commercial property markets and the data is returning some interesting news.
- Irish commercial property (down 65% since the pre-crisis peak) rose 0.3% in Q3 2013 - the first time capital values were up in 23 quarters.
- Per SCSI/IPD, the drivers were: improving sentiment relating to the value of discounted properties (bottom fishing is on) and "gradually increasing occupier demand".
- Total quarterly return on commercial real estate were at 2.6% - highest since the end of Q3 2007.
- Per release: "Demand for offices in central Dublin, from both investors and tenants, are driving returns, while recovery across the retail and industrial sectors is slower." So things are very much compressed into few sub-zones of Dublin and the 'bottom-fishing' ain't that good in the rest of the nation.
- Office capital values rose 0.9%, while capital returns to industrial and retail property were still down at -0.5% and -0.3% respectively.
- All property annual income returns were 9.7% in September 2013, the highest measured globally by IPD and much higher than 6% in the UK.
- Annual income returns were 10.2% for offices, 12.2% for industrial properties and 8.5% for retail.
- Alas, rental values fell 0.4% overall on weak retail demand (down 1.9%), offices rents were up 0.5% nationwide and 1.0% in central Dublin. Industrial rents are up 0.3%.