Slotting into Ireland’s ‘coolest neighbourhood’

Such is the fast-growing reputation of Dublin 8 that, colloquially, it is known as the ‘Dublin Shoreditch’ among locals, according to David Egan, PATRIZIA Country Manager and Director of Asset Management Ireland. David explains: “It’s a vibrant area. There are lots of pubs, cafes, restaurants.

“It will become more established once the Guinness Quarter is finished. That could be five years. There are smaller pockets of development in the area. People want to live there if they can afford to. It’s similar to the Shoreditch story. There are hotels with funky interiors. Owner-occupiers want to be there. It’s got a lot going for it.”

And PATRIZIA is not immune to Dublin 8’s ‘hipster’ charm, having recently invested in a sustainable grade A office scheme, The Eight Building, in The Liberties. The investment marks a second foray from PATRIZIA into the area after buying two student assets in Thomas Street and Parkgate.

Completed in 2021, The Eight Building fronts onto Newmarket Square, known as the centre of Dublin’s traditional brewing and distilling industries. Nestled in an area teeming with food, drink, nightlife and culture, its digital and sustainable capabilities state the case for ticking the community spirit, resilience and sustainability ‘coolness reference points.’

The EUR 60m scheme, comprising five floors and a total NIA of circa 7,340 sq m, has been developed to WiredScore Platinum Standard – the highest-awarded mark proving that a building meets exceptional standards for its wired infrastructure, resilience, and wireless network quality. It has also achieved LEED Gold Building Certification, which demonstrates that the building addresses carbon, energy, water, waste, transportation, materials, health and indoor environmental quality.

The Liberties area of Dublin 8 is a magnet for investment in innovative business. There is The Digital Hub,The GEC (Guinness Enterprise Centre) and the Fumbally Exchange, to name just a few digital enterprises in the area. The Eight Building complements its surroundings with its WiredScore mark and technology firm tenants.

Phil Irons, Managing Director, Transactions & Fund Management UK & IE at PATRIZIA, said: “Despite the current economic uncertainty in Europe, we believe the global megatrend of digitalisation is only accelerating. Cities like Dublin boast strong digital infrastructure and need well-connected, smart buildings. For PATRIZIA, as a key enabler of smart cities and smart buildings, investing in The Eight Building in this rapidly growing tech hub of Dublin was an opportunity too good to miss.”

PATRIZIA Senior Investment Advisor in Ireland, Suzie Cruess-Callaghan, worked with Phil and Angus Hayward [PATRIZIA Transactions Associate] on The Eight Building deal. Suzie sees the examples of Dublin 1 and Dublin 4 as prescient to the trajectory of Dublin 8. She cites how rent in the two postal districts has historically traded at a significant discount to prime rents in Dublin 2. That discount has significantly eroded following the influx of American and European companies to both areas. This international investment was initially driven by the introduction of the IFSC [Ireland’s International Financial Services Centre] in the city’s docks. The IFSC was a tax-driven incentive which attracted foreign companies to the area.

“The docks are pretty full now,” she explains. “There is very little development land left in the core city centre. It’s a natural progression to go from St Stephen’s Green to Dublin 8. It’s a 10-minute walk [from one to the other]. Prime rents in St Stephen’s Green are EUR 65 per foot; in Dublin 8, it’s EUR mid-40s. The area is becoming more gentrified.

“The passageway from St Stephen’s Green to Dublin 8 makes sense to us. Camden Yard [a 58,764 sq m office space with 712 sq m for retail and community] is under construction and we feel that Dublin 2 will naturally expand westwards towards Dublin 8.”

Dublin 8 is well-connected to the rest of the city, served by numerous bus routes and is a short walk to the LUAS Green Line at St Stephen’s Green – the city’s traditional central business district (CBD) and most desirable office location, according to David Egan. Dublin City Council has also approved a plan to upgrade the public areas in Newmarket Square, on The Eight Building’s doorstep, to include more trees and a large pedestrian piazza with a café.

The Eight Building takes PATRIZIA’s AUM in Dublin to around EUR 830m as the Irish capital continues to be an attractive investment proposition. The city featured in the top third (#39 out of 142) in PATRIZIA’s European City Pulse Index. Dublin’s political environment is deemed to be stable, it’s home to the world’s first carbon-neutral constructed convention centre, inspiring others to follow suit and lying at the mouth of the River Liffey, with the Wicklow Mountains as its backdrop, it’s undeniably picturesque.

Phil Irons says: “An important factor for the city’s success is its world-class fibre optic network connectivity as an early adopter of 5G in 2019, and Dublin ranks #16 for market fundamentals. The city’s population of circa 1.4m is forecast to grow to 1.8m by 2036. It continues to be a magnet for international firms, a growing student population and highly skilled workers.”

Dublin remains an expensive place to live, although it is highly liveable for those who can afford it. According to a 2020 European Commission survey on quality of life in cities, 90% of immigrants see Dublin as a good place to live.

“Institutional investors have flooded into Ireland over the past decade, taking advantage of attractive investment yields,” explains Suzie Cruess-Callaghan. “Demand for real estate remains strong, although supply is tight, with a constrained development pipeline. The city offers a pro-business economy and, after Brexit blocked easy access to the UK for many international companies, Dublin continues to be seen as an attractive alternative.”