Investment volumes hit €1.99 billion in Q4 2021, bringing total investment for the year to €5.5 billion. This makes 2021 the second-best year on record for Irish CRE investment, an impressive result considering the country was in lockdown until May.
The Q4 total represents an increase of 59% relative to Q4 2020 and is well above previous quarterly totals. Indeed, during the past five years, quarterly investment turnover has only exceeded this level once. This was in Q4 2019 when the Green REIT portfolio traded.
Ireland continues to attract overseas investment, which accounted for 70% of total turnover in Q4. There has been increased investment from US funds which represented 22% of Q4 spend compared with 10% in Q4 2020. German funds remain committed to Ireland, with Patrizia, Real IS, Deka Immobilien and Commerz Real investing a combined €393.8 million in Q4 alone to bring German investment to €1.1 billion for the year.
Domestically there has been increased activity among private investors seeking enhanced returns in the context of low interest rates. There is a distinct shortage of quality long-income stock available to meet this demand, however further opportunities are expected in 2022 as 7-to-10-year hold periods reach expiry.
Ireland continues to prove itself as an attractive location for investment. With close to €1 billion worth of assets on the market moving into 2022, activity is set to remain brisk with demand supported by continued low interest rates and an abundance of global liquidity.
