These are among the findings from the latest MSCI/ SCSI IPD index, the authoritative monitor of the Irish investment property market.
The strongest performers in the quarter were retail warehouses, Grafton Street investments, newer offices and industrial properties.
Retail warehouses continued as the overall star performer returning 3.81pc in the quarter to their investors, bringing their 12-month returns to 17.17pc on the back of 13.7pc rental growth and 9.4pc growth in capital values over the 12 months. The sector showed quarterly growth of 2.1pc, similar to Q4 2025, in both rents and capital values.
Grafton Street rents rose 2.3pc in the quarter and 3.4pc over the 12 months helping to lift capital values by 1.9pc in Q1 and 2.8pc in the 12 months. Consequently, investors enjoyed returns from Ireland’s top shopping street of 3.16pc in Q1 and 9.18pc in the 12 months.
Its north-side competitor, Henry Street, continued with its mixed performance. While capital value of properties on that street dipped 0.6pc in Q1 and 1.8pc in the 12 months, its rents recovered a slight 0.2pc in Q1. It achieved returns of 1.3pc in Q1 and 4.95pc in the 12 months.
Newer offices, built after 2010, saw their capital values grow 1.1pc in the quarter and 3.5pc over the 12 months. While MSCI does not publish rental figures for this sector, it shows total returns of 2.29pc in Q1 and 8.31pc over 12 months. That implies rents in this segment are growing faster than capital values.
In contrast, MSCI does record rents for older offices – even those built as far back as the 1970s – and despite being likely to suffer from weak energy efficiencies, these are actually generating rental growth, albeit a modest 0.3pc in Q1 and 1.5pc in the 12 months. However, they continue to suffer a fall in capital values – down 1.1pc in the last quarter and 39pc since Q4 2021.
Even more concerning for landlords who hold such offices is that the modest rent increase does not cover continuing losses which MSCI estimates at 2.37pc over the 12 months. Increasingly, such landlords are faced with choices between selling and investing substantially in upgrading.
Other office sectors are faring better as offices built since the 1980s are showing higher rental growth than the pace of percentage losses they are suffering in capital values. Consequently, even 1980s offices achieved total returns of 1.25pc in Q1 and 3.42pc in the 12 months.
When it came to rental growth, the industrial and warehouse sector was the star performer with a strong 3.1pc rise in Q1 and 6.8pc over the 12 months. Buoyed by e-commerce and logistics demand, this former Cinderella of the commercial property market has shown relatively consistent growth in rents in the last 13 years and since the beginning of 2013 their rents have doubled.
Capital values in the sector rose 1pc in Q1 2026 and 4pc over the corresponding quarter of 2025. Investors secured total returns from the sector of 2.02pc in Q1 and 8.7pc in the 12 months.
Shopping centres consolidated their previous quarter’s recovery in rents and capital values thus generating returns of 1.6pc.
