VACANCY rates on Dublin’s high streets are only around 5 per cent, despite the widespread perception that the retail sector has been hard hit by the banking crisis and recession.
A new study by agents CB Richard Ellis claims that while there have been major casualties in the retail sector, vacancies remain low.
Of of the 146 ground-level shops on Grafton Street and the pedestrianised areas of Henry and Mary Streets, only nine shops are currently vacant.
In square footage terms, Grafton Street’s ground floor vacancy rate stands at 3.2 per cent while the figure for Henry/Mary street is 5.8 per cent.
The overall vacancy rate of 5 per cent is set to fall in the near future as Forever 21 takes up a new store in the Jervis Centre and a number of new retailers are due to open on Henry Street.
The report suggests that while the first six months of this year continued to be difficult for retailers, there are signs that the worst is behind the sector. “Consumer confidence has rebounded off its all-time lows a year ago and consumer spending habits have started a tentative recovery.”
Retail rents have generally been declining across Europe in the past 18 months, with Irish high street rents down as much as 47 per cent from the peak to €5,250 per sq m for Zone A. Patrick Koucheravy, economist with CBRE, said that after a severe correction in yields from 2.5 to 6.5 per cent, recent transactional evidence from Grafton Street showed that yields had begun to contract and were now at 6.25 per cent. This was the first yield contraction in the Irish investment market since the onset of the recession.
