Level of office building over house building 'not sustainable', says developer
The high level of office building versus the low level of residential building in cities such as Dublin and Cork is 'simply not sustainable', the chief executive of Cairn Homes has said, adding that apartment construction will need to increase significantly if housing targets are to be reached.
Michael Stanley was speaking following Cairn Homes' annual general meeting (AGM) in Dublin on Thursday.
He said Dublin is 'quite a unique city, and Cork is not dissimilar' in that the amount of land available to increase the number of people living in our city is 'pretty low' and a very large proportion of that land that was available now has offices built on it.
'We have been incredibly successful as a city in building new office blocks, to some extent, hotels also,' he said.
'If you look at the ratio of office build to apartment build in central Dublin it's roughly a ratio of 6 sqm or 7 sqm of office for every sqm of residential and that's just simply not sustainable.
We can't have a city, a vibrant city, with all of the positive things that goes with any city that people live in, if you have that imbalance in what's built.
On whether the housing development sector will reach the Government's stated goal of 300,000 new homes by 2030 - 50,000 a year - Mr Stanley said in order to hit those targets, 25,000 new units would have to be apartments.
'I've no doubt that Ireland will build 25,000 low density homes a year, every year, and there will be demand for those,' he said. "Apartment building in Ireland is not straightforward,' he said, adding that regulations on building apartments are high.
Home completions last year stood at 30,330 - far below what the Government expected - largely due to a fall-off in apartment completions. The number of apartments completed in 2024 was 8,763, down 24.1% from 2023.
At the company's AGM, the property developer welcomed a 'very positive" trading environment, with 2025 so far seeing continued scaling in the homebuilder's operating platform and increased investment in the number of active sites across Ireland.
Reiterating its guidance for this year, Cairn Homes said its closed and forward sales pipeline now stands at around 3,250 new homes with a net sales value of approximately €1.25bn. That is up from 2,953 closed and forward sales at the end of February, which totalled a net sales value of €989m.
Mr Stanley said their target is to grow their housing output by between 10% and 15% this year. 'We like our chances of hitting our growth targets and continue to deliver more,' he said.
Cairn Homes said it expects build cost inflation to be running at 2% and while it was mindful of the potential impact of changes in global trade policies, it is not witnessing any adverse effect on its business at present.
The company said it is seeing a stable environment for labour costs and they are not expecting to see significant growth in their average selling price this year. Cairn Homes is forecasting revenue growth in excess of 10% for 2025, with operating profit expected to be around €160m.
Housing commencements so far this year are trending far lower than during 2024 with just under 3,000 notices issued between January and March. The number of commencements in 2024 were boosted by developers rushing to begin developments to take advantage of a series of levy waivers and rebates.
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Thousands of new homes planned for Cork, but planning and infrastructure still holding projects back
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