Opportunities & Challenges In The Irish Retail Sector
Dublin, 3rd May 2018 – Commercial property specialists CBRE today released their latest report focussing on trends in the retail sector in Ireland. According to CBRE, the retail sector of the Irish economy continues to perform solidly despite some undertones of negativity, primarily emanating from the increasing move towards e-commerce and a number of high-profile store closures and CVA’s in the UK over recent weeks.
To download a copy of the full report PDF please click here
Ireland and the UK are quite different in this respect. In addition to being supported by favourable demographics, consumer sentiment in the Irish market is positive and boosted by factors such as strong job creation, rising house prices and increasing wages. Although the volume of retail sales activity & footfall continues to fluctuate on a monthly basis, affected by recent issues such as bad weather, the overall trend is upwards.
CBRE say that some sectors of retail are performing better than others with an increase in housebuilding boosting demand for DIY, electrical and furniture & lighting over recent months while sectors such as fashion are having a more difficult time, having been negatively affected by adverse weather over recent months. As outlined in their May bi-monthly report issued earlier this week, CBRE say that retailer demand remains strong for the better performing schemes and high streets around the country, with particularly strong demand from Food & Beverage retailers. Most of the activity is emanating from indigenous and international retail brands with UK retailers remaining reticent to roll out new stores until there is more certainty around Brexit.
An interesting feature of CBRE’s research in the retail sector is their bi-annual survey of vacancy on high streets around the country. In their most recent analysis, five of the nine high streets surveyed recorded an improvement in occupancy in the last six months, which is encouraging. Sligo continues to have the highest vacancy of the high street locations surveyed by CBRE although occupancy has improved marginally in the last six-month period. At the other end of the spectrum, the tourist locations of Galway and Killarney fare best with Galway boasting a vacancy rate of less than 1% at the end of Q1 2018 and Killarney boasting full occupancy.
With an increasing proportion of activity moving online and retailers having to adapt to incorporate omnichannel offerings, it is interesting to note that more than 80% of retailers on Dublin’s high streets offer an online facility according to CBRE. Retailers throughout Ireland now need to follow suit and develop an online platform to complement their physical stores. CBRE found that only 38% of retailers on Dublin’s Henry Street and Grafton Street offer ‘click & collect’ facilities, which they suggest needs to improve if retailers are serious about maximising profits in a fast-changing world. CBRE say that high street and shopping centre yields in the retail sector remain stable at this juncture. Prime rents also remain stable but CBRE expect to see rental inflation coming through over the next six months.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2017 revenue). The company has more than 80,000 employees (excluding affiliates), and serves real estate investors and occupiers through approximately 450 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com
About CBRE Ireland
CBRE U.C., (CBRE Ireland) registered in Ireland, no. 316570. PSRA Licence No. 001528 is the country’s largest commercial real estate services company with offices in Dublin and Cork. Currently employing over 135 employees, we work with occupiers, investors and developers of office, industrial and logistic, retail, hotel and healthcare property, providing strategic advice and execution for property sales and leasing; tenant representation, corporate services; property and project management; appraisal and valuation; development services; investment management and debt advisory; business rates and compulsory purchase and research and consulting. Please visit our website at www.cbre.ie