£6m an acre for site in Dublin 4

A development site of 1.47 acres fronting on to the Grand Canal Dock in Dublin 4 has been sold for £8.8 million, the equivalent of almost £6 million an acre.

Only one other city-centre site has made a higher price, though several office sites with tax concessions in the International Financial Services Centre have made £10 million an acre.

The Grand Canal site is now occupied by an old flour mill and was sold by the IAWS Group to capitalise on the buoyant property market. It was bought by a business consortium led by a Co Clare property developer, Mr Bernard McNamara, and will be used for offices and apartments.

In March 1997 the property developer Hardwicke paid £6.2 million at auction for an office site of three-quarters of an acre with frontage on to Adelaide Road and Upper Hatch Street.

The scarcity of development land in the city has worsened since then because of the huge demand for apartments over the past few years and the fact that office vacancy rates have dropped to their lowest level for over a decade.

It is understood that six development companies tendered for the IAWS site, which includes two mill buildings listed for preservation. The sale was handled by joint agents Hooke and MacDonald and Jones Lang Wootton. Although the new owners have yet to decide on a plan for the site, it seems inevitable that they will seek permission for a high-density development because of the location beside the planned DART station on Barrow Street. The development is likely to include at least 250,000 sq ft of offices and 250 apartments.

Zoe Developments recently secured planning permission for 655 apartments and townhouses on the former Bord Gais Eireann site on the opposite side of Barrow Street. The permission is likely to be appealed to An Bord Pleanala by local residents. Zoe bought the 7.8 acre site over two years ago for about £9 million.