Over €5.5 billion was invested in commercial property in Ireland last year, according to an analysis of the market by estate agents Savills.

It was close to double the €3 billion invested in 2020, making it the second highest level of annual activity ever recorded in the market.

The improved performance was driven by a number of factors, including an improved outlook in the context of the Covid-19 pandemic and the vast amounts of money being injected into the system by central banks globally.

The largest transaction of the year was Blackstone's acquisition of the Serpentine consortium’s interest in Meta’s (Facebook) new campus in Ballsbridge for €395m.

It is understood there was considerable interest in acquiring the property with strong bidding from a number of parties.

"2022 is likely to see a buoyant office market as workers return and tenants are able to re-engage with the productivity benefits of the office environment," the report noted.

Tech and professional services occupiers continue to drive leasing activity in the office market, with both sectors accounting for around a third each of take-up in the fourth quarter.

The retail sector also performed strongly with 13 assets exchanged in the final quarter of the year alone.

The largest transaction was the Park Collection, a portfolio of prime retail parks sold to Marlet Property Group by Marathon Asset Management for €74m.

While uncertainty remains in the sector amid a change in shopping habits, the report notes that 'value opportunities' are to be found.

"Retail parks have performed well during the pandemic, driven by stable demand for electrical goods, furniture, food, and household items," it stated.

The industrial sector accounted just below a fifth of investment volumes in 2021 with €1 billion trading - a record for the sector.

"Strong macroeconomic fundamentals and expectations of future growth in occupier demand stemming from growing e-commerce sales make industrial assets attractive to investors," Kevin McMahon, Divisional Director of Investments at Savills Ireland, said.

"Investor appetite has been exceptionally strong throughout the year across most real estate sectors. The last quarter of 2021 was characterised by multiple large deals in the office and industrial sectors in particular, accounting for 36% and 27% of quarterly volumes respectively," he concluded.