Current trends in and future prospects for the real estate market (both commercial and residential) in Ireland
The office market saw a record year of leasing in 2017, primarily in Dublin. In addition to natural growth, market analysis suggests Brexit added additional demand for office space.
In the residential sector, house prices rose an average of 12.3% in 2017, mainly due to a continued lack of supply. The government allocated €1.8 billion for housing in 2018, with local authorities and approved housing bodies committing to deliver 3,800 new social houses in 2018.
Demand for good residential development sites is high, helped by the build-to-rent sector.
Real estate asset classes, such as student accommodation and nursing homes, continued to be strong in 2017. Demand for quality hotels in good locations is likely to continue in 2018.
Due diligence which should be conducted before conclusion of a real estate sale contract
Depending on the nature of the property:
- the validity of the seller’s ownership of its interest in the property;
- a structural survey;
- a boundary survey (including access and necessary services);
- an environmental survey;
- taxation analysis;
- a planning survey; and
- performance of any tenants.
- the VAT treatment of the transaction;
Environmental certifications required for the development of real estate and how are they obtained
Depending on the nature of any development, environmental licences and permits may be required. For example, certain developments require a licence from the Environmental Protection Agency for the designated use in addition to the planning permission.
Environmental disclosure obligations apply to real estate sales
A seller is required to make full disclosure of any issue (including environmental issues) which may adversely affect the asset. In addition, a seller is required to reply to standard buyer requisitions (which include specific environmental requisitions) relating to whether the property is a ‘European site’ (ie, a site affected by the European Communities (Natural Habitats) Regulations 1997) and whether any notice, certificate, order, permit, licence or consent under any environmental laws affect the property.
Rules and procedures which govern environmental clean-up of property. Which parties are responsible for clean-up and what is the extent of their liability.
The European Communities (Environmental Liability) Regulations 2008 (SI 547/2008) governs environmental liability based on the ‘polluter pays’ principle. An operator whose activity causes the imminent threat of or causes environmental damage is therefore liable for any preventative or remediation measures.
The Irish Environmental Protection Agency is the authority responsible for all aspects of the regulations.
Regulations / incentive schemes in place to promote energy efficiency and emissions reductions in buildings
Subject to some limited exceptions, there is a statutory requirement on a seller to provide a building energy rating, which provides an indicator of the energy performance of a building. Currently, there are no incentive schemes to improve the energy performance of a building.
Other topics covered include:
- Rights and registration
- Sale and purchase
- Planning and environmental issues
Source – Lexology (Mason Hayes & Curran) | Image – Irish Mirror
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