Dublin outperforms all other European office markets in terms of combined return on capital and rental income, according to Experian. Figures for 2006 show returns of 27.6 per cent while 2007's returns are estimated at 12 per cent.

The Experian report says demand for city centre office spaces has resulted in increased demand throughout the county, with demand in the suburbs catching up with city centre levels.

The financial and business service sector is a key driver of demand and returns in the office sector, according to Experian®. This strong sectional performance will drive forecasted average annual growth of 5.7 per cent in office capital values and 4.4 per cent in annual average rental growth over the period 2007 to 2011.

Simon Marx, head of real estate forecasting at Experian, says: "A strong supply pipeline over the last decade has brought a huge amount of additional office space to the Dublin market. However, much of the space coming to the market is pre-let and vacancy rates continue to fall. As the financial and business sector continues to grow we are likely to see even lower vacancy rates throughout the county. As demand increases, so too will rental values."