Despite the ongoing uptick in housing supply, construction output as a whole in Ireland fell sharply last year. Central Statistics Office (CSO) figures show the volume of production in the building and construction sector here fell by 6.3 per cent in 2023 and was down by 0.7 per cent in the final quarter.
The decline was – in the main – driven by a contraction in non-residential building, where output fell by 11 per cent year on year last year.
Demand for office space in Dublin and other urban centres has fallen sharply on a back of a global slowdown in demand linked to higher interest rates and as more employees opt for hybrid working conditions.
A recent report from BNP Paribas Real Estate predicted Dublin’s office market was likely “to get worse before it gets better” with no relief in sight until 2027 amid a collapse in demand and a glut of new developments delayed during the pandemic finally coming on stream.
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The CSO figures showed output in the residential building sector fell by 5 per cent last year but was up by 3.1 per cent quarter on quarter in the final three months of last year.
Housing completions rose to a post-crash record of almost 33,000 last year and recent commencement data suggest the momentum is continuing.
The only sector to show an annual increase was civil engineering where output rose by 9.4 per cent, according to the CSO.
The CSO’s seasonally adjusted value index for building and construction fell by 0.4 per cent on a quarterly basis and by 3.6 per cent on an annual basis.
Excluding civil engineering, the seasonally adjusted value index decreased by 1.4 per cent on a quarterly basis and was down 7.1 per cent on an annual basis, it said.
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