Irish investment market sees 26% rise in value of transactions in third quarter

The value of transactions in the Irish investment market rose by 26 per cent in the third quarter, compared to the same period last year, said estate agent Sherry FitzGerald. The Irish investment market totalled €591 million in the third quarter of this year.
The retail sector remained the dominant driver of investor spend during the third quarter, accounting for a third of turnover, or almost €196 million. This was driven by the estimated €130 million sale of The Square shopping centre in Tallaght to real estate investment companies Eagle Street Partners and Arrow.
However, only 24 transactions closed during the third quarter compared to 34 sales in the second quarter this year. The transactions in the second quarter totalled €523 million.
The report from Sherry FitzGerald noted that the market was “at the very early stages of recovery and overall activity remains below average”.
Senior economist and head of research Jean Behan said the recovery in the investment market is positively impacted by improving international interest rates and favourable asset pricing. Looking forward, she said “increasing expectations for further interest rate cuts in the medium term … bodes well”.
The third-quarter transaction figure can be credited to the increase in the price of large-scale transactions, with 13 per cent of all property sales valued at €50 million or greater, Sherry FitzGerald said.
Along with the sale of The Square, a purpose-built student accommodation build was sold to Hines for an estimated €80 million in September. Located on Stephen’s Street in Dublin 2, the building has 299 rooms and will be rebranded Aparto Dublin Stephen’s Quarter.
The third quarter this year also saw the highest level of spending on office space in a year, accounting for 10 assets on the market.
In the first nine months, investment in the Irish market totalled almost €1.3 billion. . This was 13 per cent below the same period in 2023 due to a slow start to the year.
Director of commercial and residential investment at Sherry FitzGerald Ross Harris acknowledged the recent improvement in investment activity but said the Irish rental sector has not seen the same recovery.
“The recent improvement in investment activity is encouraging. However, [private rental sector] investment has yet to experience a recovery with [private rental sector] transactional activity remaining severely hampered by viability issues and current Government policy, which remains inhospitable towards institutional investors.”
A previous report by Sherry FitzGerald released at the end of last year said investment activity in the Irish commercial market was at “the lowest level of annual turnover seen in a decade at just over €2 billion”.
The 2023 report went on to say that the investment market expected to see a “tentative recovery” as investors’ confidence was restored.