Real Estate Investor Magazine South Africa May/June 2015 | Page 63

IRELAND

Return of the

Celtic Tiger
Dublin’s Property Market
Shows A Strong Recovery
BY WIM PRINSLOO

D

ublin is a real estate market that is showing
a strong recovery after experiencing a severe
downturn that lasted all the way from 2007 to
early 2013.
Bursting of the Irish Property Bubble
After reaching a peak in 2007, the commercial property
market in Ireland fell into a recession that lasted for an
entire five years and resulted in a 60% decline in its
market value.
At the height of the recession, the Irish property
market contracted in volumetric terms to the point
where there was no functioning investment market,
with deal activity consisting of a limited number of
small scale transactions. The major issues in the Irish
market that were exposed when the bubble burst
included excess supply, a sudden absence of bank
funding and a number of highly leveraged real estate
syndications.
The Irish economic recovery
After considerable social and financial damage, the
Irish government started to implement measures to
repair the Irish economy and its banking sector. The
stability brought about by these measures led to Ireland
being the first country to emerge from its bailout
program in December 2013. After five years of decline,
real estate values finally bottomed out in 2013.
Today, investment grade ratings have been restored
by all of the major ratings agencies after Ireland’s
successful return to the global capital markets. In
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