Residential construction slides by over 10% in first quarter of 2025 compared to previous year
by 10.6 per cent in the first three months of 2025 compared to the same period last year, Central Statistics Office figures on Friday show. Production in the sector was also down 4.3 per cent compared with the previous quarter.
It comes as a new report from
estate agents JLL
says that Dublin faces a second consecutive year of declining
apartment completions
, with the numbers built this year expected to be 40 per cent down on the 2023 peak.
The group's Dublin Living Market Report, which covers the first half of 2025, said it will take several years before apartment output increases. Completions this year will be down by 17.8 per cent on 2024 levels.
Outside residential construction, the CSO data showed production volumes in building and construction more generally rose by 13.5 per cent in the first quarter compared with the same period last year. It was up 4.9 per cent on the previous quarter.
READ MORE
On an annual basis, volumes in the non-residential building and civil engineering sectors rose by 13.7 per cent and 35.9 per cent respectively. That helped boost overall construction production by value by 6.5 per cent on a quarterly basis and by 19 per cent on the same period last year.
JLL's report said apartment completions are expected to rebound in 2026 and 2027 on the back of a 'surge' in apartment construction starts last year when developers accelerated projects to capitalise on levy waivers.
Although some house building projects with lodged commencement notices did not proceed, JLL said its research suggests a large number of apartment units with lodged notices did start construction.
While apartment deliveries are projected to increase over the next two years, JLL noted that the 2024 report of the Housing Commission indicates it will still fall short of meeting demand.
It estimates that between 19,600 and 36,400 apartments are needed annually to satisfy housing needs. It said apartment completions will fall below this by an average of 49 per cent in 2026 and 2027.
Elsewhere, JLL said Ireland's residential investment market experienced a 'sluggish start' to 2025, with just €10 million deployed across two transactions in the first quarter.
However, it noted there are 'signs of modest activity' in the second quarter, fuelled by a significant deal under offer and the expected completion of Ronan Group's Spencer Place disposal to Ardstone Capital. This transaction, involving 393 apartments in Dublin 1, is valued at approximately €177 million.
The outlook for living investment in Ireland is 'cautiously optimistic', JLL said, underpinned by 'strong economic fundamentals and an engaged Government attempting to attract institutional investment'.
'The Government's active pursuit of institutional investment in the living sector is a positive step toward boosting the supply of new units, especially as apartment completions are expected to decline in 2025 compared to 2024,' the group said.
'While rent reforms might require further adjustments to generate the desired large-scale investment, the current Coalition has shifted the stance away from previous governments and now recognises the significant role private investors will play in addressing the housing crisis.'
The construction industry is lobbying for additional measures beyond rent reforms, such as VAT waivers for high-density developments or development levy waivers to improve project viability.
'A consensus has emerged among construction bodies, the Irish Government, and the European Commission regarding the critical need for productive investment in housing,' JLL added.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Irish Times
39 minutes ago
- Irish Times
Small Irish businesses say tariffs will hurt US consumers most
Many smaller Irish exporters have mixed feelings about the trade agreement between the European Union and the United States. Last week, they understood there was still an outside chance that discussions could go off the rails with the possibility of a trade war. At the same time, they are less than impressed with the outline deal being presented in the media. Sarah Furno, of Cashel Blue, greeted the news from Scotland yesterday with a 'degree of relief' and the sense that the Tipperary cheese company can now make more definite plans for the US market. Sarah and Sergio Furno of Cashel Blue cheesemakers 'Uncertainty is impossible and disabling especially in a prolonged manner,' she says. 'Overall we feel it could have been worse. It's a relatively even playing field for imports and there is enough light to keep doors open. READ MORE 'Of course it will hurt the average American most'. Ms Furno said the 30 per cent rate threatened by US President Donald Trump would have pushed Cashel products off US shelves. Leo Cummins, of Hazelbrook Confectionery in Co Kildare, decided earlier this year to shun the US market due to the uncertainty. On hearing the news of the agreement, he said he was even more convinced that ignoring the US market in the short term was 'the right thing to do'. 'Obviously one has a concern that the deal as it stands looks quite lopsided in favour of the US,' he says. Leo Cummins of Hazelbrook Confectionary in Newbridge, Co. Kildare. Photograph Nick Bradshaw 'I personally think that American candy sales will decline in Ireland, the UK and Europe over the next three years as consumer sentiment towards America becomes more negative. 'Whilst it appears that there will be no tariffs on US candy imports into Europe, American candy manufacturers will have to pay extra for their cocoa and other ingredients that are not produced in America and that will push their costs higher and hence their prices to European customers.' Mr Cummins says more expensive US confectionery will open doors for Hazelbrook in the UK and Europe as importers there will look to find cheaper alternatives. Whiskey manufacturers were particularly concerned at the possibility of trade talks failing. Brendan Carty, of Killowen Distillery in Co Down, will now have to contend with two different trade deals – the EU deal at 15 per cent and the UK one at 10 per cent. As Irish whiskey is bottled and bonded on both sides of the Border, it presents new headaches for the likes of Killowen. 'If a distillery sells 50 per cent distilled in Killowen and 50 per cent distilled in the Republic, I suppose our tariffs will be complicated and will fall between the two,' says Mr Carty. 'That's the nature of navigating a global market. It's always changing and very complex. It's the consumers who will take the hurt in the end. 'It's always a navigation exercise working things out with overseas partners, part and parcel of the business, so we won't get too upset about it'. The Irish Whiskey Association still hasn't ruled out the chance that the agreement could yet see the return of 'zero-for-zero' trade in spirits. Director Eoin Ó Catháin says the 10 per cent rate currently being applied, along with a weakened US dollar, has forced some operators to shut their doors. 'We are hopeful that, as we learn more about this deal and discussions on its implementation continue, a mutually beneficial arrangement and the removal of tariffs can be secured,' he says. The overriding sentiment from many exporters is that the deal represents an unwanted regression. With no upsides for Irish businesses – other than avoiding even worse terms – it is the new price of doing business with the US.
Irish Times
an hour ago
- Irish Times
EU-US trade deal: Ireland ‘no doubt' in challenging position over tariffs, says Minister
There is 'no doubt' that Ireland is in a challenging position in relation to tariffs but the recently announced agreement does bring 'some clarity', the Minister for Enterprise has said. Peter Burke said the deal reached on Sunday, which will lock in tariffs of 15 per cent on most EU imports to the US , had avoided a 'direct trade war'. Speaking on RTÉ Radio 1's Morning Ireland on Monday, Mr Burke said the EU was four days away from 30 per cent tariffs, which would have been 'significant', while the Government is awaiting more details to emerge. The final terms of the deal were worked out during a meeting between European Commission president Ursula von der Leyen and US president Donald Trump at his Turnberry golf resort in Scotland on Sunday. READ MORE The accord effectively sees the EU accepting import taxes of 15 per cent on most of its huge volume of trade with the US. The two sides agreed that no tariffs would be charged on imports of aircraft, certain chemicals and some agri-food goods, though the finer details of what agricultural products will benefit from these exemptions are still to be worked out. [ EU-US trade deal analysis: Tariffs have a price for both sides. Trump was willing to pay it Opens in new window ] Mr Burke said there would be a number of 'carveouts' for particular sectors such as aviation, agri-foods and spirits. He said the Government was concerned about the 'stacking mechanism', which refers to the cumulative effect of multiple tariffs applied to the same imported product. 'All of those areas have been called out for separate carveouts, so we have to see what that will look like and what will that amount to on paper, and that's where the devil is going to be in the detail,' he said. 'But the critical thing is that at all costs we have to avoid escalation because it would be devastating in terms of the impact because the scale of the market is so huge.' The Fine Gael TD said the Government had been 'very clear that tariffs are bad'. 'They constrain supply, they drive prices up. They're not good for the US economy, or indeed for the Irish economy,' he said. 'Ireland's position is very clear – we always favour an open, rules-based fair trade at every hand's turn. When you have the talk of tariffs and a deal like this, it is going to be challenging, and I think we have to be very honest about that.' [ EU-US trade deal represents 'substantial burden' for Irish businesses Opens in new window ] The deal includes EU commitments to purchase set amounts of US oil, nuclear power and liquefied natural gas annually. In terms of Ireland buying US oil or gas, Mr Burke said he was not aware of it at this point in time but could not 'give a definitive answer'. Mr Burke added that a deal between China and the US had yet to happen, which would affect Irish exports and they would also have to see what separate carveouts will emerge. 'Until we get flesh on the bones in all those areas over the coming weeks, we'll be in a better position then to really put forward what the budgetary parameters will end up with.' He also said he and the Government remained committed to cutting the hospitality VAT rate to 9 per cent and that it was in the programme for government, which had been agreed by all parties.
Irish Times
an hour ago
- Irish Times
Paul Coulson to get €108m payment from Ardagh creditors to cede control of group
Irish financier Paul Coulson has agreed to cede entire control of Ardagh Group , the glass bottles and drink cans giant he built up over the past 25 years, to a group of its bondholders in exchange for a share of a $300 million (€257 million) pay-off. The company at the top of Ardagh Group corporate tree has an estimated $12.5 billion of debt, which became unsustainable after its earnings were hit since the Covid-19 pandemic by inflation, soaring interest rates, and soft consumer demand on both sides of the Atlantic. Ardagh Group's customers range from Coca-Cola and Heineken to Swiss group Nestlé. Mr Coulson (73) effectively has a 36 per cent stake in the business, with the rest largely in the hands of management and a group of small investors that date back to Ardagh's previous existence on the Dublin stock market. On that basis, he will end up with a €108 million payment to walk away from the business. READ MORE The major debt restructuring will see senior unsecured bondholders and holders of high-risk payment-in-kind notes swap $4.2 billion of debt for equity in Ardagh Group. The senior unsecured creditors will end up with 92.5 per cent of the equity in the group, and holders of the PIK Notes will hold 7.5 per cent. [ Meet Paul 'the Cooler' Coulson: One of the godfathers of leveraged finance Opens in new window ] 'Ardagh Group is pleased to have achieved this significant milestone in agreeing a comprehensive recapitalisation transaction with its key financial stakeholders,' said group chairman Herman Troskie. 'The transaction will preserve the group's ownership of its glass and metal packaging businesses and puts in place a sustainable capital structure, with significantly lower leverage and an enhanced maturity profile. Together with the injection of new capital, Ardagh will be well-placed to deliver our business plan in partnership with our future shareholders.' Mr Coulson entered the glass bottle business in 1998 by buying an initial stake and taking over as chairman of the Irish Glass Bottle Company, which traces its roots back to 1932. After renaming the company Ardagh, he orchestrated a series of overseas acquisitions, fuelled by high-cost debt raised on the international junk-bond market, that would create one of the world's largest packaging groups with annual sales of more than $9 billion. The original bottle-making factory in Ringsend in Dublin was closed in the process, in 2002. Mr Coulson controls Ardagh through an 18.8 per cent direct stake in its ultimate parent company and a 52.4 per cent interest in a vehicle called Yeoman Capital, which owns 33.9 per cent of the group. He effectively owns 36.6 per cent of the equity. The $300 million Mr Coulson and the other investors will share is a fraction of Ardagh Group's market valuation. In 2021, it peaked at almost $6.7 billion. That valued the businessman's holding at about $2.4 billion. Ardagh Group was delisted later that year, after it decided to float its drink cans unit, Ardagh Metal Packaging (AMP). Mr Coulson stepped down as chairman of the group in late 2023, but remained a director and its major shareholder. Still, long-term investors in the group made handsome returns over the years as Ardagh Group distributed hundreds of millions of euros, often funded by the issuance of debt. While earnings have improved significantly in recent quarters in AMP as customers increasingly favour aluminium cans over glass and plastic packaging, the bottle-making business has remained under pressure. AMP's chief executive, Oliver Graham, signalled in April that the business had 'turned a corner', helped by a rebound in demand for energy drinks, sparkling water and health segments. AMP reported on Thursday that its earnings before interest, tax, depreciation and amortisation (Ebitda) rose 18 per cent in the second quarter to $210 million. The company upgraded its full-year earnings forecast for a second time and now sees Ebitda rising to $705 million-$725 million from $672 million for 2024. It had started out the year predicting that earnings would fall between $675 million and $695 million. Ardagh Group typically reports results on the same day as AMP. However, it held off on publishing its figures as the debt restructuring talks reached a pivotal stage.
