A four-storey over-basement commercial building with dual frontage on to South William Street and Drury Street in Dublin’s south inner city comes on the market today through Michelle McGarry of Colliers at a guide price of €5.75 million.
The multi-tenanted building is producing an income of €278,000 per annum which is due to rise to €367,000 by 2017. At that valuation, and assuming that purchasing costs will be around 4.46 per cent, the net initial yield on offer is 5.02 per cent.
Originally used as a fashion outlet when the “rag trade” was based in this area of the city, the building has an overall floor area of 1,445sq m (15,553 sq ft) including 464sq m (5,000sq ft) on the ground floor.
Much of this area is let to Zaragoza restaurant on a 20-year lease from 2012 at a rent of €160,000, which is due to rise to €200,000 in 2015.
The first floor is rented by Cooks Academy, a cookery school, at €70,000 per annum. Zaragoza has a break option in 2017, and Cooks has one in 2016. The second and third floors are in office use, occupied by a company named Muzu on a rolling 12-month licence for 10 years from 2011.
Colliers says that rental terms of €24,000 per annum have been agreed for the vacant retail unit at 47 Drury Street. The rent roll could also be increased by letting eight vacant car parking spaces.
Colliers says that as well as complementing the top end shopping available on Grafton Street, South William Street had been transformed from a "rag trade" district into a cosmopolitan destination for restaurants, cafes, bars and specialist shops beside heritage buildings such as the Powerscourt Centre, South City Markets and the Assembly House.
Ms McGarry predicts that the property will have “huge appeal” in the marketplace as it has a little of everything for investors – an excellent location in Dublin’s “urban quarter”, it is fully occupied, has an established restaurant use and a mixture of occupiers with good income profile and spread.