€250m for Central Park scheme in Leopardstown
Top class portfolio includes five major office blocks, retail and 272 apartments
Central Park: high-spec office, retail and residential scheme with good transport links
Nama has settled on a guide price of over €250 million for Central Park in Leopardstown, Dublin 18 – the largest single Irish property asset to be offered for sale by the State agency.
John Moran of Jones Lang LaSalle and Fergus O’Farrell of Savills are launching an international marketing campaign to find a buyer for one of Dublin’s most successful suburban developments which includes five substantial office blocks, a retail building and a multi-family apartment complex with 272 homes.
All six commercial buildings, developed by the now defunct Treasury Holdings, are being sold on the instructions of William O’Riordan and Declan McDonald of PwC who were appointed receivers by Nama.
The multi-family complex, built by John Lally’s company, Devano Developments, is producing a rental income of €3.8 million per annum. Devano is not in receivership but most of Lally’s loans are being managed by Nama.
Central Park is currently producing an overall rent roll of €17.97 million which is due to rise to over €19.32 million when a number of rent-free periods run out. The initial yield, based on a €250 million selling price, will be 7 per cent. However this will move to 7.75 per cent at the end of rent-free periods in 2015.
The range of office blocks in Central Park are widely acknowledged as having as good if not better specifications as the best of the most recent office developments in the city.
However, rents in Central Park range around €182 per sq m to €323 per sq m (€17 to €30 per sq ft) compared to the current prime city centre rents of €322 to €376 per sq m (€30 to €35 per sq ft) for top grade space. The city office market is rapidly recovering, partially because of a shortage of large volumes of newly completed space. The sharp pick-up in city rents will inevitably have a knock on effect in primary office parks such as Leopardstown and Sandyford.
The diversity and scale of Central Park also means that there are obvious opportunities for the next owners to increase returns through asset management, lease restructurings and future development.
In fact, there are 6.76 acres of commercial development land available and planning permission for three office buildings on part of it with an overall capacity of 65,680sq m (707,000sq ft). New owners will also have the option to complete a partially built apartment block with a further 166 homes.
Those pitching for Central Park will be challenged to come up with a realistic valuation for the land yet to be developed but, with the enhanced market sentiment now gaining ground, this element of the park is likely to be valued somewhere between €30 and €40 million.
Central Park’s office accommodation was first launched in 2001 when Vodafone was signed up for what was then the largest letting on record. The mobile phone operator moved into a high quality seven-storey, 24,432sq m (263,000sq ft) building distinguished by a large light filled central atrium which allows floors to be let on a floor-by-floor basis.