Building land prices are falling and the pace of their decline has accelerated due to the combination of building cost inflation and borrowing costs. That’s the view of Cathal Daughton, principal at real estate agent Lisney, who says some developers and their lenders are pausing projects because of rising costs.
However, the Greater Dublin Area (GDA) building land market has done quite well in the first half of this year with 36 deals totaling more than €260 million.
“The demand for high quality, well-located, turnkey sites is evident,” said Mr Daughton.
Two deals accounted for nearly half of the €260 million turnover and the most valuable of these was Glenveagh’s sale of 5.2 acres at 1-4 East Road, Dublin 3. It was managed by the late Eagle Street Partners Group Justin Bickle acquired over €60 million. The site has been granted full planning permission for 554 apartments with office/business, retail and a day care center.
IPUT paid the second highest price, buying 118 acres of commercial potential in Killamonan Business Park in West Dublin for over €50m. It is adjacent to the 64 hectare Cherryhound site on the M2 where IPUT intends to develop a distribution park.
Most deals were in the under €5m lot size category, with 24 sales accounting for approximately 22 percent of total sales. Three other lots were sold for more than €10m each.
The lack of logistical and industrial housing has led to an increase in demand for industrial zone land and consequently the prices for these plots of land in north Dublin have more than increased from around €100,000 per acre three years ago to around €450,000 per acre in the first half of this year doubled .
“However, due to the recent slowdown in investment, land prices will also fall in this sector,” says Daughton.
But demand in Dublin has also resulted in pubs being sold for redevelopment and in the first half of the year these were: Walkinstown House and The Kestrell Inn in Walkinstown, The Red Parrot in Dorset Street and McEvoy’s in Newcastle.
Some older office buildings were also sold for refurbishment.
https://www.independent.ie/business/commercial-property/builders-spend-260m-buying-36-dublin-sites-despite-cost-inflation-41878110.html Builders are spending €260m to buy 36 sites in Dublin despite cost inflation