Dublin Office Rents now more competitive 12.10.2011On average down 50% from the top of the market and now lower than most other major European Cities. The September survey published by Colliers International shows Dublin looking very attractive against our European competitors – another reason why Foreign Direct Investment remains active in Ireland, particularly from the US. The average rent in Dublin is now €240 per sq m per annum. Comparing this to other cities such as London City at €578.4 per sq m and London West End €924 per sq m, Frankfurt €360 per sq m, Paris €750 per sq m, Madrid €288 per sq m and Rome €348 per sq m, we look very reasonable. Rents have halved in the last 3.5 years which has been a positive step in helping Ireland look more attractive to foreign multi-nationals. The majority of office markets in EMEA have reported flat rental growth in the first half of the year; however, at the top and bottom end of the scale a few markets have reported either very strong or very negative growth, Colliers International found when conducting research for their biannual EMEA Office Rent Map. Notable at the top end have been the key Russian markets—Moscow and St. Petersburg, which have reported half year rental growth of 11% and 10% respectively. The London West End market also reported a rise in rents of circa 10%. Markets that experienced negative growth include Athens (-7%), Dubai (-8%) and Sofia (-8%). These falls being mainly a factor of deficient demand in Athens, and an excess of office space in Dubai and Sofia. While a majority of the centres Colliers monitors reported flat yields or marginal compression over the first half of the year, the two main Russian markets were, again, the standout performers—reporting yield compression of -100bps in Moscow and -200bps in St. Petersburg, with yields now standing at 9.5% and 11% respectively. Other markets that saw notable inward yield shifts were Durban, -100bps to 12%, and Abu Dhabi, -300bps to 10%. In contrast to Abu Dhabi, Dubai saw a further widening of yields, 170bps to 10.7%, reflecting further concerns over the over-supply issue in the city. Looking forward, the outlook for Class A rents is broadly positive throughout the region with the majority of centres forecasting flat expectations for the next 12 months. Some of the weaker markets such as Dubai and Sofia expect further falls in class A rents whilst major centres such as London, Moscow, Munich and Stockholm are expected to see further increases. The outlook for prime yields is flat across almost all of the cities. However, cities such as Abu Dhabi, Brussels and Prague are expected to see some yield compression as investors seek attractive yields outside of the core office markets which have already seen notable compression. The Colliers International EMEA Office Rent Map includes class A rents, yields, vacancy rates and construction levels in the major markets across the region.