Estimating the Total Value of Ireland’s Commercial Property Stock

Sameer Shaikh
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Sameer Shaikh: Central Bank of Ireland

No 3/FS/24, Financial Stability Notes from Central Bank of Ireland

Abstract: In order to aid a better understanding of Ireland’s commercial property market for financial stability purposes, there is a need to understand the overall size and relative importance of certain sectors as an appropriate benchmark. This Note integrates a variety of new data sources in order to get a broader understanding of the value of Ireland’s commercial and industrial property stock, with a focus on the concentration of certain sub-segments of commercial property across Ireland. Using administrative data on rental value estimates at the property level, I impute a market valuation for all commercial properties in Ireland based on the evolution of market rental yields. The analysis reaches a headline estimate for market value of Ireland’s total commercial property stock, including Residential properties held by professionally-managed investors for income-producing purposes, of around €144 billion. Within this, the Industrial segment is the largest, at €51bn. Offices and Retail, the two markets most at risk from recent fundamental shocks from work-from-home, ecommerce, and higher interest rates, are valued at €33bn and €25bn, respectively.

Date: 2024-06
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