The future of office space in Ireland
The office space market in Ireland has transformed in recent times, from the dizzying heights of the Celtic Tiger to the deafening economic crash. Fast forward to 2017 and the whole island is shaking to the sounds of drills, hammers and cranes once again.
Ireland has attracted numerous large, multinational corporations to its shores in the last number of years and Dublin has consistently ranked among the top three European cities for FDI.
From major moves to record rates, here are some of the key trends and an outline of what’s to come.
The story so far
As of February this year, there was 5.3 million sq ft of office space under construction or refurbishment in Dublin, with 40% of the units already pre-leased. Expansion is most apparent in the city’s Docklands area, where numerous cranes and skeletal buildings under construction dominate the landscape. While the vacancy rate for all of Dublin is 8.9%, the rate is nearly half that in the city centre, at 4.8%. According to an article from Construction Information Services Ireland, there are enough new developments, at various stages of planning, to meet this growing need for workspace. Over 130 new office buildings are planned for completion in the next five years.
It’s a similar story in Belfast. Planning permission was recently granted for the construction of Northern Ireland’s largest ever office building. One Bankmore Square will extend to 250,000 sq ft of office space. The development is in the heart of the city, close to Belfast City Hall on the Dublin Road.
Last month, Texas based tech giant, Bazaarvoice, announced it would be creating 168 new jobs in Belfast city centre. The company has made a multi-million pound investment into new office buildings close to the City Hall.
As another great example of the opportunities and growth within our little isle, Zendesk announced it will hire a further 300 people in Dublin before moving to a 58,000 sq ft office at 55 Charlemont Place. The company first moved to Ireland in 2012 with just two employees.
The Brexit effect
Since the Brexit vote last June, there has been constant speculation over what this will mean for Ireland, with tales of opportunities and warnings of complications. The only certainty seems to be the uncertainty.
Barclays recently announced it will move its EU hub to Dublin, the bank will take up residence in One Molesworth Street in the city centre for a €500,000-per-year lease.
BNY Mellon has said that the impact from Brexit on the property sector will hit offices the most. According to IDA Ireland, it has received over 100 enquiries from international firms since the Brexit vote. At Glandore, we have noticed enquiries increasing significantly in the first quarter of this year.
The uncertainty has had a positive impact on flexible workspace. International companies can establish a presence here in Ireland without committing to a 20-year lease. Businesses based here can expand in overflow space while reaping the rewards from Brexit. They also have the option to grow from one to many at a natural pace rather than relocating all of their employees at once.
Flexibility over lengthy leases
Given the amount of uncertainty in the air today, it’s inevitable that companies and investors are wary of expensive and restrictive leasing. This means that short term, flexible rental of office space can be the way forward in an era where very little stays exactly the same for very long.
Serviced office companies, such as Glandore, now offer a variety of flexible workspace options at competitive rates. With modern alternatives like coworking on offer, large companies have an opportunity to base one employee in a new city to test the waters for establishing a permanent base there. For many companies, communal space provides a cost effective and efficient trial period, while allowing employees to mingle and network with like-minded professionals.
Facebook started in Glandore with two employees and this number grew to 50 by the time it was ready to make the move to their own office space. Many of the most successful companies in the world are choosing to start small in Ireland, and availing of flexible office space to scale up in their own time.
Fast-paced future
The world of work in 2017 is fast paced, and it’s sure to speed up. Companies that choose to open new offices, or move to a new location, need to hit the ground running. They want to be at the top of their game the moment they enter a new market and subsequently cannot afford to wait for facilities to be set-up.
Companies can decline as quickly as they scale up, meaning office requirements can change drastically in a short time. Flexibility in this fast-paced world is key.
Serviced office providers can help companies to source much more than just a physical desk. They can also provide other amenities such as IT solutions and on-site catering. Some companies also provide assistance in other areas such as accommodation, gym memberships and car rental through their affiliated partners. These services remove any unnecessary distractions from the work place so these companies can focus on what matters. Establishing themselves in a new market.