Builders could repurpose offices amid shortage of homes

Developers may look to repurpose commercial buildings into homes to take advantage of a chronic undersupply of housing in the Republic, according to research.

The repurposing of commercial properties has become a significant feature of other markets and could become more prevalent in the State as the country is “massively undersupplied across all housing tenures, commercial real estate firm CBRE said.

However, there are also “significant concerns regarding the viability of apartment building as construction and financing costs increase, the company added in a 2023 Market Outlook report.

“It is likely that new supply in 2023 should reach similar levels to 2022, as projects that are currently under construction carry over from 2022, CBRE said. “However, beyond this, there are significant question marks over the viability of apartment development in Dublin in a higher interest rate environment.”

Higher financing costs will “impact new dwelling completion numbers over the medium-term with smaller developers in particular likely to find it difficult to deliver new stock, according to the research.

Furthermore, a recalibration of building standards for build-to-rent apartments is likely to make building more expensive and “add more pressure to apartment viability, it said. – Bloomberg