The new headquarters of Airbnb, under construction in Dublin's south docklands and due to be completed by February, is to be sold through Savills for over €30 million.
At that valuation the net initial yield will work out at 4.71 per cent and the capital value at €8,395 a sq m (€780sq ft).
Unlike standard high-rise glazed office blocks in the docklands, the Airbnb offices at 8 Hanover Quay are being developed within a warehouse, reflecting the heritage and style of the docklands. It is also the first construction in the south docklands since the area was designated as a Strategic Development Zone.
Because of the shortage of Grade A office space in prime city centre areas, Brendan Delaney of Savills says it was no surprise that a deal has already been agreed for a tenant to occupy the building once construction is completed.
Airbnb Ireland – with a guarantee from Airbnb Inc –- has agreed a 20-year lease of the two-storey over basement waterfront building which will extend to 3,574sq m (38,471sq ft) and include 44 bicycle spaces.
The investment will generate an initial rent of €1,475,000 with a fixed uplift resulting in the rent rising to €1.7 million in 2021. The lease offers investors an unexpired term of seven years to a tenant break option. The office building will become the European headquarters of Airbnb.
The US-based corporation was founded in 2008 as an online marketplace that allows people to liaise and book accommodation around the world. The company was recently valued at $25 billion (€22bn).
The external fabric of the Hanover Quay incorporates existing stone and brick walls which have been repaired in line with the best conservation practice. Inside the retained façade is a modern open-plan office centred around a light-filled atrium running through the centre, pitched roof.
The building will have exposed steel columns, raised access floors, wooden detailing on the suspended ceilings and metal rooflights.
There will also be an enclosed courtyard garden at ground level and a balcony at first-floor level providing views over the Grand Canal Dock area.
Design at 8 Hanover Quay is by RKD and it is being built by Bennett Construction on behalf of TIO ICAV. This company is managed by Los Angeles-based Oaktree Capital Management and the other investors are Bennett and Nama.
Hanover Quay is a vibrant urban quarter with modern office blocks, apartment developments, shops, hotel, bars and restaurants.
The area is a great cultural and entertainment location with the Bord Gáis Energy Theatre, Aviva Stadium and the 3Arena in the neighbourhood or nearby.
Justin Bickle, chairman of TIO and MD of Oaktree, said Airbnb's choice of this building for its EU headquarters was a clear endorsement of Dublin as a thriving hub for foreign direct investment.
Delaney said they expected demand for the building from a wide variety of investors either seeking to expand their portfolio with prime office stock and also from new entrants wanting to make their first acquisition in Ireland.