The sale of Airbnb’s European headquarters is expected to attract strong interest from Irish and international investors in the context of low interest rates and lack of yield elsewhere.
Located at the junction of Hanover Quay and Benson Street in Dublin’s south docklands, 8 Hanover Quay as it is known, will be brought to the market later this week on behalf of a fund managed by BNP Paribas Real Estate Investment Managers (BNP Paribas REIM) at a guide price of €41.5 million.
The sale by joint agents BNP Paribas Real Estate and Savills offers the prospective purchaser the opportunity to secure immediate rental income backed by a strong tenant covenant and an attractive net initial yield of 3.73 per cent. Both agents declined to comment on the sale when contacted by The Irish Times.
While the subject property has served as the Europe, Middle East and Africa headquarters of Airbnb since 2016, and comprises 3,747sq m (40,343sq ft) of grade-A office accommodation, its original warehouse served for many years as the former Raleigh bicycle factory before being redeveloped by Targeted Investment Opportunities, a joint venture involving Nama, Oaktree and Bennett Construction.
Practical completion was reached in 2016 and today the building benefits from a full-height central atrium featuring a natural auditorium that has made it one of the most photographed office interiors in Dublin.
Number 8 Hanover Quay is let in its entirety to Airbnb Ireland Limited under a full repairing and insuring lease with a full parent company guarantee in place from Airbnb Inc, which underwent an initial public offering in December 2020 and has a market capitalisation in excess of US$100 billion.
The next break option in Airbnb’s lease at 8 Hanover Quay is in March 2030, giving the property an attractive term certain of 8½ years, and a weighted average unexpired lease term of 14½ years with the expiry in 2036.
The property’s current passing rent of €1.7 million (€454 per sq m/€42 per sq ft) offers the buyer a highly reversionary investment proposition within the context of the current Dublin market, where prime offices within the central business district continue to command rents of between €55 and €60 per sq ft. The next rent review (open market) is due to take place in March 2026. The building creditation is “very good”. With no on-site car parking, the requirement is for staff to walk or cycle. The building has strong environmental, social and governance credentials with a Breeam (Building Research Establishment Environmental Assessment Method) sustainability review. Moreover, public transport adds to the its green credentials.
Airbnb also occupies a further 3,715sq m (40,000sq ft) across 2½ floors in the adjoining Reflector Building, which is now owned by German-headquartered real estate investor Deka Immobilien.
BNP Paribas REIM gave consent to break the boundary wall between the ground floor and 8 Hanover Quay and the Reflector Building to allow for a seamlesss working environment for Airbnb employees between the adjoining properties.