DUBLIN—In recent months, several Dublin commercial estate agents report they have been haunted by a shadowy cabal of well-fed, well-toned gentleman, seeking office space and speaking in educated East Coast American accents.
“We were calling them the men in black,” says one. “We joked they might be secret service.”
Now, however, the penny is dropping, and those estate agents are starting to realize that the Americans casually enquiring after, ooh, say 50,000 square foot of prime office space, may well have been the representatives of American banks such as Morgan Stanley, which has been forced to deny rumors that it has been scoping the Irish capital as a possible new base for its 2,000 staff in the event of a possible Brexit vote.
Few people in Dublin believe Morgan Stanley’s protestations. Another big American outfit has already set up a significant base in Ireland; Fidelity International hit the headlines when it signed two leases to rent 68,000sq foot of property in the center of Dublin earlier this year.
It was the biggest commercial property rental of the year in Dublin, with Fidelity paying €49 per square foot, and a nice day’s work for the building’s Irish-American owners, Green Reit, who acquired the building in June 2014 for €375 million.
Ireland stands in the curious position that it may well be hit harder than any other European nation by Brexit, but also benefit from the fall out more too. On the downside; border controls look likely to be reintroduced between the Republic of Ireland and British-controlled Northern Ireland, and rewriting trade deals following the exit of its biggest trading partner from the E.U., will trouble legal minds in Dublin for many years to come.
The silver lining of Brexit for Ireland is that established companies, tech start-ups and talent seeking to relocate from London are already circling the only other fully English-speaking city in the E.U; Dublin.
Fintech—that’s financial technology to the rest of us—startups look to be among the first companies that will now head to Dublin’s Docklands, rather than plunking down millions for office space at London’s ‘Silicon roundabout’ as the once-tatty traffic circle at Old Street is now known.
New arrivals will be joining upwards of 30 ‘scalable’ payments companies such as Paypal, Ding and Realex that already call Dublin home. Part of the reason a mini-fintech invasion is being confidently predicted is, ironically enough, because London has been wooing fintech very actively this year.
Now, Britain’s departure from the E.U. puts the concept of financial passporting—which essentially means a UK financial service license is valid across the E.U.—in mortal peril. Fintech firms based in London really have to now relocate somewhere to be able to remain relevant in a global market.
However George Delaney, a corporate finance adviser specialising in start-ups and fintech, was cautious in conversation with the Daily Beast. “Anybody involved in Fintech with a focus on E.U. market will be considering Dublin today. But they will also be considering Helsinki, Tel Aviv, and Berlin—this is not just going to fall into our laps. We have a lot going for us, but we can’t take it for granted.”
Niamh Bushnell, the grandly named Dublin Commissioner for Start-ups, believes that there are significant ‘silver linings’ to Brexit for Dublin.
“It’s not just about the tariffs and costs and difficulties of attracting international talent [to the UK] that will flow from Brexit,” she tells the Daily Beast, “It’s as much about the mentality and culture of being ‘open for business.’ Obviously there is also a huge challenge for Irish companies which would have traditionally looked to the UK as our first external market. Now we will have to be focusing much sooner on bigger markets like the US.”
What does she make of reports that several thousand highly paid American bankers could soon be descending on Dublin?
“Of course, it’s good that these companies are looking at putting people in Dublin. But for me, I am much more interested in attracting the early stage companies, the start-ups and the founders.”
Bushnell also identifies fintech as a key area: “Deloitte is opening its global blockchain lab in Dublin, the Citi innovation lab is here, a few yards from my office. We are very strong in these areas.”
Ireland is certainly working hard to sell the message that it offers tech employees a sustainable work-life balance in these febrile times.
Tech/Life Ireland, a new national initiative to brand Ireland as a top destination to pursue a career in technology, was launched on Monday with the goal of luring 3,000 tech employees here per annum.
There may be snags: Owen Reilly, a Dublin estate agent in the tech-heavy Docklands area, says that housing supply is so tight that the arrival of several thousand well-paid, demanding foreigners would be close to impossible to accommodate. “Rents are already back to pre-bust levels,” he says, “Dublin’s biggest problem right now is capacity.”
If so, the country had better get building. Some experts are projecting that as many as 300,000 people could work in the financial sector in Ireland over the coming years, if the city capitalizes on the possible potential Brexit poses.
The Chinese symbol for crisis is, famously, made up of the words for ‘danger’ and ‘opportunity’.
That pretty much sums up the position Dublin finds itself in now, as its oldest enemy, oldest friend and largest trading partner marches out of Europe, heading uncertainly towards the door marked ‘Exit’.