The canary in the coalmine

Tuesday, 17 September 2014 - The Small Firms Association (SFA) says that recently published report on rising vacancy of commercial properties in the west of Ireland underlines the ongoing concerns of rising costs in the small business community. The SFA, the leading representative group for businesses employing fewer than 50 people, recently published a report which showed that over 80 percent of businesses have experienced rising costs in the past year.

The report from GeoDirectory in partnership with EY, stated that the number of vacant commercial properties has hit an all-time high. The report’s data, which is backed by An Post and the Ordnance Survey, showed that commercial vacancy rates are as high as one in three commercial units in the worst-hit areas. This is primarily due as the closure of traditional pubs and shops continues in small towns.

The report found 30,046 empty commercial units across Ireland at the end of June, with the vacancy rates up in 14 out of 26 counties, despite the overall strength of the Irish economy.

Reacting to the report, David Broderick, Director of the SFA said:

“This report shows that the increase in vacant commercial properties, particularly in small towns in the West of Ireland, is the canary in the coalmine for the small business community. While the report does reference changing consumer habits, it also says rising business costs are a factor.

“Seeing more derelict commercial shopfronts on our streets is a visible scar in our towns, particularly on the west coast. Small businesses represent the lifeblood of commercial and social activity in communities across the country. Too many businesses are struggling to cope with high commercial rates, energy costs and rising labour costs in recent years.

“This report underlines the findings of a recent SFA survey which found that eighty-three percent of small businesses have experienced rising costs. The SFA research also showed an estimated increase of 16.6 percent in average business costs while 57 percent of businesses say that labour costs have contributed to rising costs. Alarmingly, 35 percent of businesses stated that they could not trade beyond six months without additional funding.”

The GeoDirectory report showed that the rate of dereliction are highest in small towns in the west of the country. Donegal had a commercial vacancy rate of 19.4pc in the second quarter of 2024. That had jumped by 1.5 percentage points in the year to the end of June – the highest increase recorded in the period. The national commercial vacancy rate in Ireland rose to 14.4pc in the period from April to the end of June, up 0.3 percentage points from the same period last year.

This is the highest vacancy rate recorded by the organisation since reporting began in 2013. In Dublin, the commercial vacancy rate rose 0.2 percentage points to 13.3pc in the second quarter of this year.

ENDS

Note to Editor:

• Link to SFA ‘Cost of Business’ report here: https://ibec.sharefile.com/public/share/web-s2e65a676a8054141b0a3a15c296b56db
• The Small Firms Association proudly represents a diverse membership of businesses with less than 50 employees: homegrown and spanning every sector of the economy with members found in every town and every city in Ireland.
• Details of the recently published SFA Policy Priorities document (April 2024) can be found in the following link: https://www.ibec.ie/sfa/news-insights-and-events/news/2024/04/17/sfa-call-for-urgency-in-supporting-small-businesses