A narrative has taken hold in certain quarters in the housing crisis that says scores of apartments in high-end build-to-rent (BTR) schemes are being left vacant by their developers, who are refusing to drop prices to fill them.
Capital Dock, Kennedy Wilson’s 22-storey tower in Dublin’s south docklands and the tallest residential complex in the capital, has emerged in the past couple of years as the most oft-used example of this vacancy anomaly in the middle of an acute crisis.
Ronan Lyons, associate professor of finance and a regular commentator on the housing crisis, takes aim at the narrative in the latest Daft.ie rental report, of which he is the author.
“Capital Dock has become somewhat infamous in certain circles as an example of new high-spec apartments allegedly left empty while Dublin’s renters suffer,” writes Lyons. “However, an examination of publicly available information reveals that it was three-quarters full at the start of 2022, with active leases on 142 of its 190 addresses.”
Lyons goes on to say that other high-profile build-to-rent schemes in Dublin 8 and in Cork have occupancy rates of more than 80 per cent.
“Some might say [that] while four out of every five units being occupied is certainly better than none, if replicated across the city and country – and continued into the future – this would result in thousands of homes being left empty, at a time when Ireland desperately needs new rental homes,” Lyons states.
But, he notes, the high-profile examples of vacancies most usually cited by critics of such schemes are not the norm in the build-to-rent sector. Smaller such schemes show “far tighter” vacancy rates.
“In total, across 63 identifiable complexes completed before 2021, with nearly 7,800 homes, the latest publicly available information suggests that 90 per cent of those – just under 7,000 – are occupied. Compared to the narrative of empty buildings of luxury apartments hulking over the city, the picture from Ireland’s [BTR] sector currently is one of strong demand translating into homes being used,” he argues.
Fair enough but a vacancy rate of 10 per cent still adds up to a lot of empty units.
