The commercial property market in Galway remained robust throughout the year with the only obstacle to further growth being a lack of supply in key sectors, according to Cushman & Wakefield's 2016 review. The reemergence of the traditional pillar banks backing property, along with the continued presence of cash buyers in the market, has meant that competition for good quality assets has improved.
A strong year for the Galway office market was driven by the FDI sector, new entrants to Galway’s market included MetLife, Heat Software, IP Switch, The Mathworks, and Site Minder. With office rents on the rise due to strong demand and lack of supply Cushman & Wakefield Galway sees considerable potential for a large, modern, office campus for the city, with further potential for speculative building in the suburban areas. The office market in Galway continues to have the lowest vacancy rates of any area of the country with vacancy running at just seven per cent, and with no speculative offices currently under construction this situation is unlikely to change in the short term.
The other sector witnessing strong local and national demand is the development land market. Demand for good quality sites, particularly for residential land, remains very strong as end values improve and development becomes more viable – land values in the city are continuing to rise in line with this demand. One of the key pieces of infrastructure for the city is the proposed Galway City Outer Bypass. A planning application for the project is due early next year which will be viewed as a positive for the future growth of Galway city.
As has been the case for the past number of years demand for investment stock in the city also remains high, with yields in this sector contracting further during 2016. Looking forward, the best investment opportunities will be determined by predicting occupational and rental growth trends.
Cushman & Wakefield looks forward to building upon a strong 2016 and identifying new opportunities in a number of sectors for its clients during 2017. The company's recent merge with Cushman & Wakefield globally has allowed the Galway team access to a greater depth of resources in active key areas such as student accommodation, healthcare, and the capital markets.