£200,000 key money sought for offices on The Green

DUBLIN firm of solicitors Arthur Cox is seeking key money of £200,000 for one of the four office buildings it is to vacate on Stephen's Green at the end of the year.

Jones Lang Wootton is to assign the lease of the premises following confirmation by Cox that it is moving to the Lifetime Assurance offices at the Earlsfort Centre in Dublin 2.

Cox is understood to be paying a premium of around £900,000 for the office block, reflecting part of the cost of fitting out and furnishing the 55,000 square feet of space. The firm is to sublet 15,000 square feet.

The availability of premiums for offices underlines the shortage of well-located, high-quality office space in the city. The Cox building at 44/45 St Stephen's Green is owned by New Ireland Assurance Co and has almost 16,000 square feet and 14 car-parking spaces. The rent of £174,000 equates to around £10 per square foot.

Tony O'Loughlin of Jones Lang Wootton says this rent is significantly below the open market value". The next review was not due to take place until February, 1999. Additionally, the offices were fitted out to a high standard, he said.

Arthur Cox has not yet decided what to do with two adjoining buildings at 42 and 43 St Stephen's Green, which are owned by a number of partners in the practice. Another building, Number 41, also rented by Cox, is owned by Friends Provident.

While the premium to be paid by the legal firm for the Earlsfort Centre is the largest yet agreed in the city, it is not the only key money paid for space in the same office complex. A year ago, the State-run Irish Medicines Board paid a premium of £150,000 for over 22,000 square feet of space vacated by computer software company ACT Kindle.

With the volume of vacant office space in the city now below 4 per cent - the lowest level for many years - Hardwicke is planning to proceed with a large speculative office development which will have frontage on to Upper Hatch Street and Adelaide Road. The company recently paid £6.2 million at auction for the site of three-quarters of an acre, making it the highest price paid in Dublin for a development site - the equivalent of £8.25 million per acre.

There is planning permission for two office blocks with a total floor area of 87,000 square feet. Jones Lang Wootton is quoting a rent of £20 per square foot for the building.