Eyre Square centre may fetch €22.5m

JACK FAGAN
Commercial Property Editor

The freehold interest in Eyre Square shopping centre in Galway as well as a range of shops and retail units are to be offered for sale in the coming weeks.

Lisa Finn of DTZ Sherry FitzGerald and Ed Douglas and Simon Plunkett of DNG Commercial are quoting €22.5 million for the controlling interest in the city centre complex owned by Gerry Barrett's Edward Holdings which was placed in receivership by Bank of Scotland (Ireland).

With Barrett’s involvement currently producing rents of €2,032,000, the investment will show an immediate return of 8.6 per cent with the prospects of a higher rent roll when a number of structural changes are made.

There is already planning permission to replace the entrance off Eyre Square with a new three-storey building to accommodate five new retail units and a café/restaurant with deck area at first floor level.

Eyre Square shopping centre was developed by McInerneys and opened for business in 1991.

Most of the 60 shops in the 14,864sq m (160,000sq ft) development were sold off in the early years to tenants or to high net worth individuals in a position to avail of urban renewal tax breaks.

McInerney retained ownership of the freehold of the centre as well as the common areas and a number of stores before selling out to Mr Barrett in the early 2000s. These shops include those rented by New Look, JD Sports as well as part of the Penneys store which are currently producing rents of €1,680,000 per annum – 83 per cent of the total income.

The common areas have a mixture of kiosks, stores, telephone masts and signage areas which bring in an additional €250,000 per annum. A number of small retail units let on short-term leases in the ramps area of Eyre Square are producing a further €67,000 per year.

A former bank building which now forms part of the shopping centre at 19 Eyre Square has tenants Goodbodys and DNG Commercial on the upper floors. City planners recently approved of the use of the ground floor as a food outlet and the letting agents say they expect strong interest in the spacious facility from a number of specialist companies.

With Galway’s main retail opportunities concentrated in the city centre, investment opportunities have been extremely limited.

The last significant deal involved the sale by Gerry Barrett of the Edward Square shopping enclave at the William Street side of the Eyre Square complex to the Irish-based Signature Capital for €27.3 million.

The shopping centre is currently attracting around 185,000 visitors per week, many of them using the adjoining 450-space car park which was recently sold to Q Park for an undisclosed sum.

DNG said it was expecting a considerable number of offers for the shopping centre because of its primary location, strong financial returns and the opportunities to increase the rent roll through strategic asset management.