About half of the shops in the boom-built Beacon South Quarter (BSQ) in Sandyford, Dublin 18, are to be offered for sale in a single lot.
Patricia Ward of DTZ Sherry FitzGerald is guiding €11.5 million for 24 retail outlets and a separate industrial building which have been asset managed for the last six years by receiver Simon Coyle of Mazars.
Beacon South Quarter, a vibrant mixture of dashing high rise buildings with shops and a supermarket, apartments, offices, a private hospital and a hotel were mainly developed between 2006 and 2008 by the Paddy Shovlin-led Landmark Developments.
The wide mix of high quality buildings won instant approval and a planning award but, once the banking crisis struck, various parts of the development ran into trouble and were sold to investors noted for their deep pockets and business acumen.
Denis O'Brien took the hospital which is now up there with the best in the country. The Beacon Hotel has been managed from the start by Paul Fitzpatrick's Lifestyle Hotels and more recently eight other BSQ shops including Bo Concept, Your Local Pharmacy and Roche Bobois were sold to UK-based Development Securities and Clarendon Properties, a company controlled by Paddy McKillen and Tony Leonard.
It will be no surprise if the same partnership pitch for the 24 shops in the portfolio now going for sale.
Most of the 800 newly-built apartments were also in strong demand from the start, hardly surprising given that Sandyford now has a workforce of around 20,000. Around 250 of the apartments and further development sites were bought by Iris Reit at a substantial discount.
Ten of the 24 shops are currently vacant but with retail sales rapidly recovering and traders once again on the lookout for additional outlets, the BSQ portfolio seems set to benefit from the improving economic conditions.
Even as things stand, the 14 shops trading are bringing in a net rental income of €534,407 and a full rent roll of €948,289. This figure is set to rise when the vacant shops are let and the stepped rents or rent-free periods expire.
As the largest tenant of premises being offered for sale, Ulster Bank accounts for around 30 per cent of the overall rental income and has a further 16.75 years to run on its lease.
The anchor tenant, Dunnes Stores, trades over two floors but does not form part of the sale.
Of the 24 shops going for sale, 21 are at Plaza Level and three are in the Courtyard. The sale also includes a warehouse on a site of over half an acre at 19 Corrig Road which is let to Knight’s Catering at €40,000 per annum. The 10-year lease running until 2024 gives the tenant an option to purchase the premises.
All 25 units for sale have an overall floor area of 10,917sq m (117,512sq ft) and include the highly rated indoor play museum for children known as Imaginosity which pays a rent of €85,000 per annum.
The food offering among the retail units going for sale includes Munchies, Starbucks, Coffee Shop and Pizza Hut. There is also the Centric Health, Primary Care, Ben Dunne Gym and Mango Tree.
BSQ also has a good reputation as an interior and furniture destination with tenants such as S.O.U.L Lifestyle, Roche Bobois, Kube Kitchens, Bo Concept and Red Earth trading successfully. The 10 vacant units vary in size from 45.8sq m (493sq ft) to 1,310sq m (14,109sq ft). Some of them are already fitted out and others have planning consent for restaurant use.
It will be no surprise if some of the vacant units attract the attention of owner occupiers as well as investors.
Beacon South Quarter is beginning to move on again after the difficulties of the past few years. Construction is under way on 68 apartments fronting on to Blackthorn Drive and several other developments are also under consideration.
Patricia Ward, director of DTZ, said the retail element of Beacon South Quarter was in line for growth and long term viability because of the strong catchment area and its close proximity to new residential areas and so many different businesses.
BSQ is within 10 minutes’ walk of Stillorgan and Sandyford Luas stations and is also close to junctions 13 and 14 of the M50.
For further information visit the Beacon South Quarter website www.theBSQinvestmentportfolio.com.