The loss of 520 units in the retail and wholesale sector was the main driver as the rate of empty commercial properties across the State climbed to a record high of 14.6 per cent in the second quarter, new data shows.

A total of 30,800 commercial units were classified as vacant in buildings data group GeoDirectory’s latest commercial vacancy rates report. The analysis, prepared by EY, found the rate increased in 17 out of 26 counties compared with a year earlier.

All sectors witnessed a decline in the number of commercial units, with the exception of industry, which covers activities like manufacturing, water supply, and construction.

The largest proportion (46.6 per cent) of this decline was attributed to the retail and wholesale sector, which suffered a loss of 520 units, followed by the services sector which suffered a decline of 325 units.

Looking within the services sector, the accommodation and food services sector had a total of 22,061 commercial units in June. That represents a decline of 150 commercial units compared with the same period in 2024.

The highest proportion of accommodation and food service units were found in the west of the country, accounting for 23.8 per cent of all commercial units in Kerry, 20.4 per cent in Clare and 19 per cent in Donegal.

The highest commercial vacancy rates continue to be found in the west of the country with Sligo, at 20.8 per cent, recording the highest proportion.

Donegal recorded 20.3 per cent, Galway with 18.7 per cent, Leitrim with 18 per cent and Limerick at 17.9 per cent rounded off the top five counties with the highest rates.

The starkest increase in rates was again seen in Donegal where there was a 0.9 percentage point increase, bringing about a vacancy rate of 20.3 per cent.

Meath, at 10 per cent, was the county with the lowest rate. It is followed by Wexford with 10.6 per cent, Westmeath with 12.2 per cent, Kerry at 12.2 per cent and Cork followed closely after with 12.5 per cent.

[ Republic’s commercial vacancy rate hits highest level on recordOpens in new window ]

The rate in Dublin was 13.9 per cent, which was a 0.6 percentage point increase compared to the previous year.

Breaking the capital’s data down by postcode, Dublin 2 was the area with highest rate at 18.4 per cent. It was followed by Dublin 8 at 17.4 per cent, Dublin 3 at 16.7 per cent and Dublin 9 at 16.5 per cent.

Meanwhile, Dublin 15 had the lowest rate at 6.8 per cent, followed by Dublin 16 at 7.7 per cent and Dublin 20 at 8.4 per cent.

Of the 80 main towns and urban areas surveyed nationally, Ballybofey, Co Donegal, registered the highest rate at 33.7 per cent.

Shannon, Co Clare, moved to second place from third previously with a vacancy rate of 30.8 per cent, followed by Boyle, Co Roscommon, at 29.8 per cent.

At the other end of the scale, the towns with the lowest vacancy rates are Carrigaline, Co Cork, at 5.1 per cent, and Greystones, Co Wicklow at 5.5 per cent.

The Government has been warned to scale back spending or risk overheating the economy.

In its latest quarterly bulletin, the Economic and Social Research Institute (ESRI) said the Government’s fiscal stance, including the proposed €9.4 billion budget for next year, was adding to demand pressures at the wrong time in the economic cycle.

This could be damaging in the long term “if capacity constraints or cost inflation” prevent the full delivery of the National Development Plan (NDP), it said.

“Ideally the Government should be running a surplus when you adjust for the windfall taxes,” the ESRI’s Alan Barrett said.

“In order to do that you would be looking at scaling back expenditure or raising taxes something of the order of €8-€10 billion, rather dramatic numbers,” he said.

“The adjustment overnight would have almost an austerity look and feel about it and I don’t think that’s entirely appropriate fiscal policy either,” he said.

“What’s required is a moderation in growth [in spending] over time and a targeting of a [underlying] budget surplus … but to kind of glide to it over the next three, four or five budgets,” he said.

Mr Barrett said the Government needed to have a “credible” medium-term fiscal strategy.

The ESRI’s warning comes on the back of a similar one last week from the Central Bank, which claimed the additional expenditure being proposed in Budget 2026 was “too large” and “unnecessary”.

[ Budget 2026 plans will limit response to future economic shocks, committee hearsOpens in new window ]

In its latest assessment, the ESRI predicted the economy here would grow by 8 per cent this year in gross domestic product (GDP) terms against a previous projection of 4.6 per cent.

The upgrade for 2025 reflected the “large increase in exports” at the start of the year as firms, particularly in the pharma sector, stockpiled produce in the United States ahead of expected tariffs.

GDP growth is expected to fall back to 2 per cent next year, a downgrade on the previous estimate, as exports moderate in the face of tighter trade conditions.

The ESRI said the European Union-US trade deal, which applies a 15 per cent tariff on most EU exports to the US, had “removed a considerable amount of uncertainty from the economic landscape”.

“While this agreement reduces uncertainty in the short term, the new situation of a 15 per cent tariff represents a deterioration in our trading environment, and will likely be impactful for many firms and sectors,” it said.

In its report, the ESRI noted that while headline inflation had moderated considerably and would contribute to real wage growth, grocery price inflation remained elevated – at 5 per cent – presenting a cost-of-living challenge for many households.

It also questioned the Government’s opposition to the proposed Mercosur trade deal.

The institute said the EU’s trade deal with South America was predicted to increase GDP by 0.13 per cent out to 2035 while having only a minimal impact on beef production.

“At a time when economic policy should be directed towards protecting and enhancing free trade, it seems counterproductive to be opposing free-trade agreements,” it said.

C&C Group, the drinks company behind Bulmers and Tennent’s, faces limited sales growth over the medium term if it does not carry out mergers and acquisitions (M&A) to boost its stable of brands, according to analysts to a new report from RBC Capital Markets.

A “leading premium or craft” drink brands deal, priced in the order of £200 million (€229 million), would make more sense than targeting a key brand in the UK, RBC analyst Tania Maciver suggested in the report. A transaction of that size would equate to almost 40 per cent of C&C’s current market value.

“While C&C is not currently in the market for acquisitions, we believe that a large and more diverse brand portfolio, similar to C&C’s much larger, global peers, is key to higher longer-term growth potential,” Ms Maciver said.

“Operating in a highly competitive beverages market in the UK and Ireland, coupled with changing consumer preferences for alcoholic beverages, we see limited top-line growth potential for C&C’s current brand and distribution divisions without an M&A strategy in place.”

A spokesman for C&C declined to comment on the potential for M&A.

C&C flagship brands are Tennent’s, Scotland’s number-one beer brand, and cider brands Bulmers and Magners. It also has a number of niche premium and craft brands, including Orchard Pig cider, Five Lamps Irish lager, and Menabrea Italian beer, that made up only €27 million, or 9 per cent, of its branded products net revenue last year.

The group has been more concerned with divesting assets in the past four years, including: Vermont Cider Company in the US (for less than 7 per cent of its $305 million purchase price in 2012); and its stake in UK pub chain Admiral Taverns.

C&C’s fifth chief executive in as many years, Roger White, who took charge in January, has set his sights on boosting innovation across the three main brands, which had been partly neglected in recent times, to grow sales and earnings.

He is also targeting margin growth in the Matthew Clark Bibendum (MCB) drinks distribution business C&C bought in 2018, but which went through a badly managed warehousing software system roll-out a few years ago.

While C&C’s shares rallied about 23 per cent from the start of the year to mid-August, they have since lost all those gains amid weakness across the broader UK beverages market and, more recently, news that its chief financial officer, Andrew Andrea, plans to step down early next year to join Domino’s Pizza Group.

Mr Rogers moved in March to drop what had been widely viewed as an unattainable goal of reaching €100 million operating profit in its financial year to February 2027, saying it would be hit in the “medium term”. RBC estimates that it will be 2030 before that goal is met.

With C&C’s drinks distribution division targeting earnings before interest and tax (ebit) margin expansion from 2.3 per last year to greater than 3.5 per cent over the medium term, Ms Maciver said the branded products division needs to be expanded “to really get the true benefit” from distribution. C&C sees its branded unit’s margin widening from 15 per cent last year to more than 17 per cent in the medium term.

Meanwhile, the RBC analyst said there was an argument for C&C to be viewed “more as a strong UK distribution business, benefiting from a relatively small, regional brand business, rather than the other way around”.