OFFICE MARKET:THE LATEST office report from agent Lisney says take-up in Dublin held up well in Q1 2008 when almost 60,000sq m (645,834sq ft) of new lettings were completed.

Paul Hipwell of Lisney says the outlook for the second quarter is positive with several major transactions likely to be completed before the summer.

"These include deals involving law firms William Fry, BCM Hanby Wallace and Dillon Eustace Eversheds which are all close to concluding in the docklands area," says Hipwell.

But the report notes that as economic growth moderates and the credit crunch begins to affect financial firms' expansion plans, office take-up is likely to ease back in the second half of 2008.

Hipwell says that total take-up for the year will be between 150,000sq m (1.614 million sq ft) and 190,000sq m (2.045 million sq ft).

"While this is well down on the take-up levels seen in 2006 and 2007, which were record years, it represents a return to the more sustainable figures seen in the 2003-2004 period."

However, the report highlights that there has been a high level of office construction in recent months, and this will inevitably change the balance of the market.

Dr John McCartney, head of research at Lisney, says 110,000sq m (1.184 million sq ft) of new Dublin office space was completed in Q1 2008.

This meant that more offices were completed in Q1 2008 than in the whole of 2006.

Looking at the projects under construction, this building boom seems set to continue for another 15 months.

"The market will take time to digest the amount of new product coming on stream and this could see the quantity of available space creep up later in 2008."

Hipwell agrees, but says this is not necessarily a negative, as although city centre vacancy rates were currently at 8.4 per cent, the figures masked a scarcity of good quality office space in the centre of town. "The specification, design and location of the new buildings should ensure that they would appeal to many occupiers," says Hipwell.