Citigroup has signed for a new headquarters in Dublin, in a boost for the office market in the capital.
The US lender has agreed a €300 million deal for a new office campus in the city’s north docklands. The deal with Johnny Ronan’s RGRE for the delivery of 300,000 sq ft (27,870 sq m) of office space at the developer’s Waterfront South Central site was concluded in the week leading up to Christmas.
Citi is understood to be paying about €100 million to acquire the site, with a further €200 million being set aside for the construction of its new base. Due for completion in 2026, the bank’s proposed footprint will equate to roughly 70 per cent of the 430,000 sq ft of office accommodation RGRE intends to develop as part of the wider north docklands scheme.
News of the agreement should provide something of a fillip for the capital’s commercial property sector coming as it does at a turbulent time for the global tech companies whose requirements have driven much of the demand for office space in the Dublin market over recent years.
Facebook’s decision not to occupy the four blocks developed for it by RGRE at its new Ballsbridge campus has, for instance, brought 34,838 sq m (375,000 sq ft) of office space back to the letting market while LinkedIn’s decision last October to seek an alternative occupier for two blocks under development at its new European headquarters in Wilton Park have added a further 265,000 sq ft to the city’s available office stock.
Firms took up about 206,000 sq m of office space in Dublin during 2022, CBRE said in a statement on Friday. That was an increase of about 35 per cent year on year. Still, it is about two-thirds of the space taken up in 2019 before the pandemic struck.
It remains to be seen meanwhile, what impact, if any, Salesforce’s announcement earlier this week to cut its global workforce by 10 per cent will have on its office accommodation requirements in Dublin. The company is due to move into its newly developed European headquarters at Spencer Place in the city’s north docklands in March. Developed by RGRE, the campus extends to 40,041 sq m (431,000 sq ft) and comprises three office buildings along with a 204-bedroom hotel let to Ireland’s largest hotel operator, Dalata Hotel Group.
While Salesforce signalled its intention this week to reduce its office footprint globally by setting aside $450 million-$650 million for what it describes as “exit charges associated with office space reductions”, in the case of Dublin, much of the heavy lifting may already have been done. As reported by The Irish Times in December, SMBC Aviation Capital has agreed a deal for all 135,617 sq ft of space at Fitzwilliam 28, the newly developed office block which Slack Technologies had signed for in early 2020. That plan was abandoned when Slack was acquired subsequently for €27.7 billion by Salesforce. Slack’s entire operations will now be located at Salesforce’s new European headquarters at Spencer Place.