Businessman and former bookmaker Joe Donnelly is likely to secure over €25 million for three prime retail investments he is planning to sell at Patrick Street in Cork.
The buildings are currently producing a rent roll of over €1.1 million, according to James Meagher of DTZ Sherry FitzGerald, who is handling the sales.
Mr Donnelly, a tax exile who along with his wife Marie is now living in Paris, is thought to be planning to reinvest the proceeds of the Cork sales in the French capital. The couple are collectors of contemporary art and own a large modern art gallery with caretaker's flat on Killiney Hill.
The three properties are all let to strong covenants and are likely to be bought by private investors.
There have been scarcely any high street investments available in Cork over the past year because of the strengthening rental market and the absence of credible alternative investment opportunities.
Dublin has also experienced a pent-up demand for good retail investments and many of those that have come on the market in the past 12 months have sold to private investors for record prices.
Two of the buildings going for sale are located along one of the best trading pitches on Patrick Street. The most valuable property, number 35, at the corner of Patrick Street and Cook Street, is let to Clinton Cards under a new 25-year lease. It is expected to sell for around €11.3 million, reflecting a yield of 4 per cent. The rent of €508,000 per annum set a new benchmark for Cork, equating to a Zone A level of €4,273 per sq m (€397 per sq ft). The store, which has a retail area of 331 sq m (3,562sqft) at street level, was the first Clinton Cards outlet in Ireland.
The company has over 700 shops in the UK and posted a profit of almost £25 million sterling for the year ending last February.
The Monsoon store investment at number 36 Patrick Street is likely to sell for about €5.3 million, showing an initial yield of only 3.5 per cent because of the reversionary nature of the rent. Monsoon is paying a rent of €210,000 that is due to be reviewed in three years.
This breaks down at a Zone A level of €3,606 per sq m (€335 per sq ft), well below the rate set for Clinton Cards. The Monsoon lease of the 130 sq m (1,399sqft) of space on the ground floor runs until 2017.
The parent company has been one of the stars of the fashion industry in Britain and Ireland, owning the Monsoon and Accessorize groups of shops that recorded after tax profits of over £26 million sterling last year.
The third investment going for sale, number 70 Patrick Street, is rented by Bank of Ireland on a 35-year lease from 1977. It is expected to make close to €10 million, showing a yield of 3.75 per cent. The current rent, which was reviewed last year, stands at €385,000, and is also reversionary at a Zone A level of €3,272 per sq m (€304 per sq ft).
The building has full return frontage on to Peter and Paul's Place and excellent access from Paul's Street. The bank has the use of 770 sq m (8,288 sq ft) of space including 593 sq m (6,382 sq ft) at ground level.
James Meagher says the continued demand for retail investments is underpinned by the high level of inquiries from international retailers for outlets in the prime streets of Dublin and Cork.
Patrick Street is undergoing a €12 million improvement which is due to be completed within a few months.
Wider pavements are being created to enhance facilities for shoppers. Other improvements will include tree planting, new street furniture and bus shelters.
Sales of commercial investments have been stronger than expected this year, exceeding €620 million up to the end of September.
