The total number of deals was 79, meaning the average deal size was 42,000 sq ft – the largest annual average this cycle. There were 22 transactions of big-box units sized 50,000 sq ft or more, accounting for 68% of space taken. This compares with a ten-year average of 52% and is the highest share since the series began in 2014. A growing share of transactions have occurred across big-box units over the past decade, reflecting occupiers’ appetite for expansion of their Irish operations – with the proportion of deals attributable to this size category rising from 18% in 2019 to 28% in 2023.

The largest of these was logistics firm Wincanton’s Q1 letting of 286,000 sq ft at Building 2, Greenogue Logistics Park, where it is managing IKEA’s first customer distribution centre in Ireland. This was followed by the Q4 letting of 240,000 sq ft at Aerodrome Business Park to PRL Group.

On a sectoral basis, logistics made-up 58% of take-up in 2023, with 18% attributable to first-party logistics and the other 40% accounted for by third-party logistics. This includes FedEx’s pre-letting of 163,000 sq ft at F1 Horizon Logistics Park, which will serve as its Irish headquarters. Another notable transaction was the pre-letting of 113,000 sq ft at Unit P2, Horizon Logistics Park, which is a design and build completion for packaging solutions firm WestRock. The move forms part of plans to consolidate its Dublin operations. Elsewhere, PCI Pharma took 69,000 sq ft at 736 Northwest Logistics Park as part of its post-Brexit expansion in Ireland.

The vacancy rate closed out the year at 1.7%, up slightly from 1.5% at the end of 2022 as an additional 256,000 sq ft was brought to market. Notably, only three of 54 vacant units have been built since 2020, with the vast majority of vacant stock built in the 90s or before. The largest addition was the 108,000 sq ft former Crown Paints facility on the Malahide Road, which has been available since Q1 2023. The second biggest was 88,000 sq ft at Unit 605, Greenogue Business Park, which was brought on in Q3 for short-term lease.

Jarlath Lynn, Director of Industrial and Logistics, commented:

“Our prime rents which are based on best-in-class new build logistics facilities are expected to exceed €14.00 psf during the course of 2024. This will see real prime rents (adjusted for inflation) surpassing the previous cycle peak of 2008 for the first time, although today’s occupiers are getting much better value for their money. In particular, they are benefitting from next generation specification, enhanced building capabilities and efficiencies, and associated ESG credentials.”

This upward rental pressure will be driven by the significant undersupply of existing and new build stock in 2024. Jarlath continued:

“In addition, we are witnessing rents in excess of €17.00 psf being quoted and agreed in certain instances, typically for units below 20,000 sq ft in prime locations. These rents, which are significantly ahead of any previous levels, reflect the demand and competitive bidding in the market.”