City Centre Retail Leasing Activity continues to Rebound; Retail investment now in Vogue

CBRE Ireland today released its Dublin Retail market research report for Q2 2023. The findings of the report include:

High Street

Dublin city centre appears to have now fully recovered from the pandemic. Footfall has rebounded strongly, office occupancy is ticking up, and there is an increased sense of vibrancy around the city centre this year that was lost during the pandemic.

This trend is reflected in the healthy retail leasing activity seen around the high streets of the city centre this year. Grafton St., Henry St., Mary St., College Green, Duke St. and South Anne St. have all seen new deals sign and/or new store openings in the last six months.

Notable City Centre Leasing Deals in H1 2023

Quarter	Tenant	Sector	Address	Approx Size Sq. M
Q1	Levis	Fashion & Footwear	42 Henry St.	958
Q2	Carroll's Irish Gifts	Consumer Goods	6-8 College Green	928
Q2	HMV	Consumer Goods	18 Henry St.	808
Q1	Tessuti	Fashion & Footwear	22-23 Henry St.	632
Q1	Dubray Books	Consumer Goods	39 Mary St.	431
Q2	Castore	Fashion & Footwear	34 Grafton Street	200

Shopping Centres

Blanchardstown Shopping Centre continues to trade well and enjoy strong footfall growth. In May the centre reported that footfall was up 8% year-to-date versus the same period in 2022.

The newly extended and revamped Zara store, along with ‘Nike Unite’, which opened under a 10-year lease in May, have added increased footfall and vibrancy to level 1 of the centre. On the ground floor, the opening of a new Flannels store in the unit previously occupied by Debenhams is catering to the increased demand for upmarket clothing brands.

The revival in the success of Blanchardstown Shopping Centre is particularly notable. The centre offers a wide range of stores and brands, catering to all ages and demographics, and is situated in a catchment area with a strong population growth trajectory.

Leasing activity continued apace at Dundrum Town Centre in H1. New deals signed in the first half of the year include Superdrug, Nike and Skechers. The opening of a new Penney's store in the unit previously occupied by House of Fraser will be a further boost to the centre's footfall.

Retail Warehouses & Investment:

Almost 40% (€115m) of Q2 investment spend was deployed into the retail sector. In Q2, the retail sector accounted for the highest proportion (40%) of Irish investment spend for the first time since Q4 2016, when Liffey Valley Shopping Centre traded. Investors are seeing more value in retail assets at present, given that the sector is at a more advanced stage of the repricing cycle to the rest of the real estate market. Secondary assets, with higher yields, that had already experienced price recalibration in the years prior to 2022, have attracted strong interest from both domestic and international capital this year. 

According to Bernadine Hogan, Head of Retail Agency at CBRE Ireland, “we have seen positive leasing momentum and new store openings in the first half of the year across the main city high streets and shopping centres in Dublin. The opening of new ‘Nike’ stores at Blanchardstown Centre and Dundrum Town Centre, were a particular highlight in Q2, of which we were pleased to be involved in both transactions. Separately, in the city centre, we were pleased to advise Foot Locker in acquiring their new ‘flagship’ long-term letting, in the former H&M store on Henry Street. The strength of Ireland’s consumption patterns, combined with population growth continues to make Dublin and regional Ireland an attractive destination for retailers to locate. We have a strong pipeline of sales and leasing activity that should and need to convert into new store openings in the second half of this year, while investors are increasingly focused on the sector.”