US fund pays €21m for Waterford’s City Square

The City Square shopping centre in Waterford is to be upgraded and extended when it is taken over shortly by new owners. The New York-based Marathon Asset Management has agreed to pay over €21 million for the centre which is producing an annual rental income of €1.7 million.

Selling agents JLL and DNG Commercial estimate it will cost around €2.5 million to implement changes including repositioning the entrance to the centre and proceeding with a two-storey extension which will create a further 1,600sq m (17,222sq ft) of retail space. Four shops needed to facilitate the extension have been taken back by the management.

There are also plans to amalgamate some of the other shops to provide traders with larger units and open the way to a better tenant mix.

The centre has 35 shops and kiosks in all, with an overall floor area of 5,150sq m (59,309sq ft) apart from the two anchors Dunnes Stores and Debenhams which trade over two levels.

River Island is paying a rent of €173,000; GameStop contributes an abated rent of €125,000 rather than the contracted rent of €165,000; Burger King €150,000; JD Sports €130,000; Specsavers €120,000; Eircom/Meteor €90,000; Peter Mark €80,000; Holland & Barrett €70,000 and Mulligan's Chemist €65,000.

The highest contracted rent of €258,250 was agreed by stationer Cards ‘n Things but has been abated to €160,000.

Shoppers have access to 450 car parking spaces at two basement levels which are owned by a separate investor and are currently being offered for sale through Purcell Properties at a guide price of €7 million. City Square was developed in 1994 by Sisk and sold a year later to IBI Property Nominees Ltd.