Dublin-listed property group Hibernia REIT said today that 98% of its commercial rent for the quarter ended September has now been received or on agreed monthly payment plans.

In a trading statement issued ahead of its AGM, Hibernia REIT also said that 98% of residential rent for the month of July has been collected.

Hibernia REIT said the Covid-19 lockdown has had a significant impact on the volume of investment transactions and lettings in the Dublin market. 

It noted that investment transactions in the first half of 2020 totalled €1.1 billion, down from €1.8 billon the same time last year, with aggregate activity in the second quarter falling to €0.4 billion from €1.2 billion last year.  

Meanwhile, Dublin office take-up in the second quarter of the year was particularly impacted by the restrictions on movement, with letting volumes of 0.1 million square feet compared to 0.4 million square feet in the second quarter of 2029.

This resulted in the vacancy rate for Grade A office space in Dublin's city centre growing from 5.9% to 6.6% in the quarter ended June 2020 and the overall Dublin office vacancy rate growing from 6.5% to 7.3%.  

But Hibernia REIT said that investment and letting activity are beginning to resume, adding that it expects greater clarity on the trajectory of market yields and rental levels in the coming months as transactions complete.

It also said that work on its 2 Cumberland Place development remains on track for completion by the end of 2020. 41% of the building was pre-let to 3M in April.

Kevin Nowlan, chief executive of Hibernia REIT, said it was reassuring that whilst the business has not escaped the impact of Covid-19, the quarter ending September is showing rent collection rates similar to the previous quarter. 

"Following a sharp slowdown in investment and leasing transactions in the market due to the lockdown, activity has started to resume and the coming months should provide greater clarity on market rental levels and yields. At present we expect a modest decline in our net asset value per share over the six months to 30 September 2020," Mr Nowlan said. 

"Notwithstanding the uncertain economic outlook Hibernia remains in a strong position: our balance sheet is extremely robust, we have a high-quality tenant base and an accretive development pipeline to deliver long term value for our stakeholders," he added.