Ireland's commercial vacancy rate soared to a record high of 14.5 percent in the final quarter of 2024, exceeding pre-pandemic levels by 1 percent and representing an increase of over 2,100 commercial units. This translates to more than 30,000 vacant business locations out of a total of 210,894 units nationwide.
The report highlights significant regional disparities. Sligo exhibited the highest vacancy rate at 20.6 percent, followed by Donegal (20.1 percent) and Galway (18.8 percent). Dublin, while at 13.6 percent, still registered a 0.5 percent increase compared to the same period in 2023, with Dublin 2 experiencing the highest vacancy rate within the city at 18.7 percent.
The services sector dominated occupied commercial properties, accounting for 49.4 percent of the total. The retail and wholesale sector followed with 21.9 percent, while the health sector contributed 9.5 percent.
Several factors contributed to the increased vacancy rate. These include the pandemic's impact, shifting consumer shopping habits towards online platforms, and persistent cost pressures impacting businesses and households. Despite a robust economy, population growth, and record employment, the rising vacancy rate contradicts these positive indicators.
Annette Hughes from EY Economic Advisory noted the paradoxical situation: while residential vacancy rates continue to decline, commercial vacancy trends show an opposing upward trajectory.
The Republic’s commercial vacancy rate hit a high of 14 per cent last year, with more than 30,000 business locations classified as being vacant, according to property database GeoDirectory.
The group’s latest commercial vacancy report, compiled with the help of consultancy EY, indicated that out of a total of 210,894 commercial units in the State, 85.5 per cent (180,259 units) were occupied, while 14.5 per cent (30,635 units) were vacant in the final quarter of 2024.
Sligo recorded the highest commercial vacancy rate at 20.6 per cent, followed closely by Donegal at 20.1 per cent and Galway at 18.8 per cent.
Dublin’s commercial vacancy rate stood at 13.6 per cent, 0.5 per cent up on the same quarter in 2023.
“Despite this being the highest level of vacancy recorded in Dublin since Q4 2016, the current rate is still below the national vacancy rate of 14.5 per cent,” the report said. Dublin 2 had the highest vacancy rate of all Dublin districts at 18.7 per cent, which is 4.2 per cent higher than the national vacancy rate.
The services sector accounted for the largest share of occupied commercial properties, making up almost half of the total (49.4 per cent), the report noted.
The retail and wholesale sector had the second-largest share, making up 21.9 per cent of the total, while the health sector represented the third-largest share (9.5 per cent).
“While residential vacancy continues to decline significantly, dropping to just 3.8 per cent in our most recent GeoDirectory residential report, commercial vacancy trends are going in the opposite direction,” Annette Hughes, director at EY Economic Advisory, said.
“At 14.5 per cent, the rate now sits 1 per cent higher than before the Covid pandemic, representing an increase of over 2,100 commercial units, and comes despite a strong economy, growing population and record employment,” she said.
“There are likely many factors at play here including changes triggered by the pandemic, evolving shopping preferences and continued cost pressures on businesses and households,” she said.
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