Commercial property: €57.5m for Nama office portfolio

Four Dublin city buildings to generate interest from investment funds

 

With Dublin office rents climbing by an average annualised rate of more than 15 per cent over the past three years because of a shortfall in supply and strong tenant demand, Nama has every reason to expect strong interest from Irish and overseas investment funds in four individual office buildings in the city which are to be offered for sale from today.

Sean O’Brien of agents CBRE is guiding €57.5 million for The Liffey Portfolio which will provide an initial yield of 4.5 per cent and about 6.6 per cent when all the available space is let.

The four office buildings at Kilmainham, Pearse Street, Sir John Rogerson’s Quay and Schoolhouse Lane, off Kildare Street, have an overall floor area of 13,705sq m (157,534sq ft).

Investors will have the option of buying any of the individual buildings or the diversified portfolio. And to sell the four properties, CBRE plan to operate a single phased bidding procedure to give the frontrunners a period of exclusivity to complete due diligence.

The best known and most valuable Grade A office block in the portfolio is 1 Kilmainham Square which served for a time as the Irish headquarters of the internet giant Amazon and is located beside the Clarion Hotel and the Chocolate Factory apartment development in Kilmainham, close to Heuston Railway Station.

CBRE is quoting €28.5 million for the five-storey block over basement car park with an office area of 6,827sq m (73,491sq ft) and 62 car spaces.

The tenant line-up in the multi-let offices includes Perexel, a fast-expanding biopharmaceutical research multinational.

The most recent arrival is Heineken Ireland which has leased a full floor for use as their marketing and logistics headquarters. The ultra modern building with an impressive full height atrium is currently producing a rental income of €1.3 million which will rise to €1.83 million when the available space is rented.

CBRE is guiding €13.9 million for a quite innovative modern office development behind a row of restored Georgian townhouses at 51-54 Pearse Street and the interlinking Magennis Court. The five different levels in the Pearse Street property extend to 2,352sq m (25,327sq ft) and are primarily let to the noted architects Henry J Lyons.

The other tenants are the investment banking services group Rubicon Infrastructure Advisers and marketing consultants Brandstone. A double basement car park is shared with Magennis Court which otherwise has 1,597sq m (17,197sq ft) of offices over four floors, all leased to Atlantic Language School.

The two buildings are fully let and producing a rental income of €835,000 which will give the next owner a return of 6 per cent.

The selling agent is seeking €7.4 million for 14, 15 and 16 Sir John Rogerson’s Quay, a six-storey office building, as well as the adjacent Columbia Mills, a fully restored former warehouse fronting on to the quays. All the space is rented and producing €432,000 per annum. The 830sq m (8,941sq ft) in the Mills serves as the headquarters for Emuse, a global advertising technology company.

The 899sq m (9,676sq ft) of modern space in the remainder of the building at 16 Sir John Rogerson’s Quay is leased in its entirety to the advertising agency Publicis QMP.

A valuation of €7.7 million has been put on 5 Schoolhouse Lane, a striking modern office building strategically located just off Kildare Street and near St Stephen’s Green. It is predominantly vacant at the moment and when fully let should produce around €460,000 in rents. The five-storey block has an impressive double height entrance lobby and an overall floor area of 1,149sq m (12,371sq ft).