Key city centre corner likely to be redeveloped

A key retail enclave in Dublin’s south inner city looks set to be targeted for redevelopment following its sale to a European real-estate investment firm.

London-based Meyer Bergman and an Irish partner, Navan developer Eamonn Duignan, are to pay in excess of €90 million for Nassau House, a five-storey office and retail block overlooking Trinity College with a row of shops fronting on to Nassau Street and Dawson Street.

The owners of the portfolio, British multinational insurance company Aviva, sold it in an off-market deal through agents JLL. Max Reilly of JLL, who was involved in hand picking a list of developers and investors invited to pitch for the property, said that he would not be making any comment.

Meyer Bergman, with the help of its Irish partner, apparently moved quickly to clinch the UK company’s first Irish deal, suggesting it may have been eyeing up the property for some time. The UK company, which specialises in creating value through development, will have been aware of its potential as a retail pitch, being used by many of the shoppers moving between Grafton Street and Dawson Street.

Mr Duignan has been associated with the development of a number of shopping centres, mainly in the provinces, and recently worked his way out of Nama.

Earlier this year Meyer Bergman sold the Bentall Centre, a high-grade shopping centre in Kingston-upon-Thames in the greater London area, which it had owned for five years. The 90-shop complex is based in one of the wealthiest catchment areas in the UK, with the highest annual comparison-good-spend per head. It is the third largest retail centre in London and is anchored by a Bentalls department store.

Nassau House dates from the 1970s and has an overall floor area of about 9,290sq m (100,000sq ft) of which less than a third is divided between nine shops at street level.

Demand

Office space in the four upper floors has always been in keen demand because of its central Dublin location. The building is producing a rent roll of €3.5 million.

The new owners are expected to seek planning approval for an eight-storey building extending to possibly as much as 18,580sq m (200,000sq ft) with about a quarter of the space to be divided among a range of shops. The new owners are unlikely to opt for a department store given the pent up demand for spacious fashion shops in the area around Grafton Street.

A short distance away, on Dawson Street, Green REIT is awaiting the outcome of an appeal by An Taisce against the decision by Dublin City Council to allow it to demolish the former Royal & Sun Alliance headquarters at the junction of Dawson Street and Molesworth Street and replace it with a six-storey block.

Largest retailer

On Nassau Street, the House of Ireland, which specialises in Irish gifts such as Waterford crystal and jewellery, is the largest retailer in the Aviva complex, occupying four shops and an office, for which they pay an overall rent of about €200,000 per annum.

Other retailers include Tiger, Spar, Insomnia, the Irish Celtic Store, Café Gray, Lemon Crepe and Mooch Frozen Yoghurt.

The office tenants include the Bank of Ireland, which pays rents of €750,000, and Independent College, which contributes €800,000 for space on Dawson Street. Other tenants include the Irish Clearing House, which pays a rent of €450,000, as well as Irish Shipbrokers; software specialists New Relic; New Ireland Assurance; Banking and Payments Federation of Ireland; Irish Payments Services Organisation; Irish Paper Clearing Co; the Institute of Banking; and solicitors Good Murray Smith.