Dublin's two main city centre shopping streets, Grafton Street and Henry Street, are recording occupancy rates of 98.1% and 99.4% respectively as rents on new prime zone A lettings fall by up to around 50% to pre-boom levels, according to new research from Savills.

By contrast, Grafton Street is achieving EUR 4,000 per square metre per year and Henry Street EUR 3,000. 'This year will see Grafton Street achieve near to full occupancy by the end of the year with the arrival of two new retailers,' Savills said.

The real estate adviser reports that take-up from new retailers has led to a scarcity in supply with very few small units available, causing increasing demand for adjacent locations such as College Green, which will see the opening of Abercrombie and Fitch later in 2011.

New retailers to the area have included Disney Store, Pandora, Sketchers and Forever 21, all of which have opened stores on these key streets in the past year. The strong take-up is reflected in an 0.6% increase in retail sales volumes in the first quarter of 2011, compared to the year-earlier period, however values of sales were down 1.2% year-on-year, illustrating competitive pricing amongst retailers.

In terms of investment, Savills said that transactions have been minimal on both streets over the last 12 months and this has meant yields are difficult to estimate with a guide of 7-7.5% on Grafton and Henry Street, and shopping centres at 8.5%. A prime retail investment sale has not been completed since July 2010.

Joan Henry, head of research at Savills Ireland, said: 'Dublin is increasingly recognised as a European hub for high-value jobs in the IT sector, and this has helped boost its competitiveness as a city in terms of rental levels and incentives. The lack of transactional data reflects the slow investment market but with this positive outlook for Grafton and Henry Streets, in particular, we would expect to see appetite for retail product in these locations if it were to be brought to market.'