Investor demand for industrial & logistics (I&L) product around Europe is insatiable at present. The Cork market is also now the focus of potential investors. With attractive demographic and economic fundamentals and an undersupplied market with little vacancy, investors and developers see opportunity
The Irish economic outlook is extremely positive. As Ireland’s second city, the Cork market will play a significant role in driving growth over the next cycle. With a growing population, a highly educated workforce and talent pool, alongside an abundance of global employers in the technology and pharmaceutical space, the city and the broader South-West region has an exciting economic outlook.
–Ireland’s GDP will rebound by +15.3% in 2021, and the medium term outlook is highly robust. Irish ‘Modified Domestic Demand’ will grow by +7.1% 2022 and +4.1% in 2023 according to forecasts by the Irish Central Bank
–The South-West region, including Cork City and County, generally accounts for between 25%-30% of annual Irish economic output. According to the Q2 2021 CSO Labour Force Survey, there were almost 752,000 people in employment in the “Southern” region (excluding Pandemic Unemployment Payment recipients)
Cork Industrial & Logistics Market
The Cork industrial and logistics market is undersupplied at present. CBRE estimate that the I&L vacancy rate is currently approximately 1.9%. The market is also starved of Grade A stock. Approximately 22% of all stock in the Cork market is classed as Grade A. With the continued shift to e-commerce, the impact of Brexit on supply chains, the economic expansion ongoing in Ireland and the improving connectivity of the South-West/Cork region, the demand from I&L occupiers is growing.
Investment volumes into Irish I&L product are on course for a record year in 2021. In the first three quarters of the year €422 million has been deployed into Irish l&L investment assets, with 98% of this capital deployed into assets in the Dublin/Kildare region. There is demand for I&L investment product in the South-West region, particularly well-positioned, modern assets in the Cork area.