Digital and Lufthansa announce move to East Point

Two more international companies are to move into East Point Business Park in the Dublin docklands despite continuing uncertainty about the tax regime that will apply in the enterprise areas. Digital is to lease a new 30,000square-foot block while German airline Lufthansa is in discussions to rent a building of 35,000 square feet. Digital will be paying a rent of £13.50 per square foot for its building, which is currently being fitted out. The company is expected to employ about 300 people in software support. Harrington Bannon advised Digital. Lufthansa will use its new Dublin base as a European call centre and has already begun recruiting staff. The airline is investing £1.8 million in communications in Dublin and the main reservations centre in Kassel, Germany. The new system will enable Kassel to transfer overflow calls to Dublin. The Kassel centre receives more than 330,000 calls a month. Meanwhile, the EU Commission has asked for and secured additional information from the Irish Government on the special tax relief which applies in enterprise areas. In addition to East Point, the areas being looked at include Ken Rohan's site at Grand Canal Street; Gallenstown in west Dublin; and Finglas in north Dublin. Three areas in Cork and one in Galway have also come under scrutiny. The previous government also made provision for the seven regional airports and the areas around them - excluding Shannon Airport - to be given special tax designation. Rosslare Harbour also received a similar designation. A number of major investors are reluctant to fund developments in the enterprise areas until the EU Commission issues its findings by the end of this month. While changes in the Irish tax regulations do not generally operate retrospectively, the EU invariably takes a different view, according to one expert. Tax concessions already awarded could conceivably be clawed back on a retrospective basis. The enterprise zoning provides significant tax reliefs for developers, occupiers and owners. There are capital allowances of up to 100 per cent of the costs incurred for new buildings or refurbishing existing buildings. If the occupier does not own the building, they can claim double rent relief for up to 10 years. Rates relief is also allowed on a sliding scale for 10 years.