Grafton St is (as ever) leading the charge...
Retail property rents are entering a phase of slower growth - but increases of between 7% and 10% are predicted over the next 2 years according to a new report from property consultants, Savills Ireland.
Dr. John McCartney, Director of Research at Savills Ireland commented:
"Rents in some prime shopping locations have already risen by more than a third over the last three years. As the retail economy transitions from its early recovery phase to a sustainable growth phase, base effects are inevitably going to dampen the annual percentage increase in rents."
The report also identifies a notable softening in some short-term indicators such as retail sales, VAT receipts and consumer sentiment over the last year.
However, it adds that it believes that this reflects uncertainty - rather than "underlying weakness in the economy."
Looking through this turbulence, however, Savills research shows that employment is by far the strongest leading indicator of retail rents in the long run. With jobs growth of 2.9% in the last year retail rents are therefore expected to continue rising - albeit at a slower pace.
Savills thinks that rents will be 10% higher on Grafton St by the second quarter of 2018.
It notes that the imminent arrival of Other Stories and Victoria Secret reflects the strength of international demand to come to the south Dublin shopping thoroughfare.