The €575 million of development land sales last year was 17 per cent down on 2016, according to a new report from Cushman & Wakefield.
However, the number of deals in 2017 – at 225 – was sharply up on the 184 concluded in 2016.
"The trend of 2017 in the development land market was increased sales activity but of smaller holdings," according to the agent, whose figures refer to the Dublin, Cork, Galway and Limerick markets.
However, sales of development land in the greater Dublin area rose by 24 per cent to €490 million while the number of deals in this area increased by 15 per cent to 150. Curiously, despite strong values, sub-€5 million sales accounted for 89 per cent of all transactions in the greater Dublin area.
Cushman & Wakefield says the most notable land transaction in Dublin last year was the €107.5 million sale of 8.64 acres of RTÉ's Montrose campus to Cairn Homes.
“The sales pipeline for Dublin and its commuter counties appears strong for early 2018,” according to the agent. “At year-end, it was estimated that about 85 sites were sale agreed, with an estimated value of more than €215 million.
‘Substantial contraint’
“But supply issues acted as a substantial constraint on the market in 2017. The appetite to engage in development exists, but the required stock to satisfy this demand did not come onstream. At the end of 2017, there were in the region of 110 development sites available for purchase in the greater Dublin area.”
Donal Kellegher, a director of Cushman & Wakefield, expects more private landowner sales to be a feature of the market in 2018 as supply levels improve.
“This will benefit small and medium-sized developers, in particular, and help push the total transacted closer to €1 billion by year-end,” he says.
In terms of Cork, Limerick and Galway, Cushman & Wakefield says the development land market in these regional centres recorded robust increases in the value of transactions during 2017.
Cork saw more than 40 deals closing, up 29 per cent on 2016, for a total value of more than €50 million – a rise of 62 per cent on 2016. There are about 50 sites still available on the Cork market, which is “broadly in line with the level of supply seen 12 months previously”, according to the agent.
Galway development land sales were more than €21 million in 2017, up from €12 million in 2016. Sales in Limerick topped €10 million for the year.
“Despite the expansion in both the Galway and Limerick markets, with supply levels improving on the previous year, the availability of land, in particular prime residential land, remained constrained,” according to Cushman & Wakefield.
