Industrial and office investment at €48m offers net initial yield of 6%

Novelty Portfolio distributed across three established schemes in Dublin and Galway

Units 25-29 of Mervue Business & Technology Park in Galway are let to Avaya International Sales Ltd

Units 25-29 of Mervue Business & Technology Park in Galway are let to Avaya International Sales Ltd

 

Agent Harvey says it expects to see strong interest from a range of domestic and international parties in the sale of the “Novelty Portfolio”, a mix of industrial and office properties distributed across three locations in Dublin and Galway. The investment is being offered to the market individually or as one lot at a guide price of €48 million.

The portfolio comprises three assets, located in Cloverhill Industrial Estate, Clondalkin, Dublin 22 (guide price €17 million), Mervue Business & Technology Park, Galway (guide price €19.5 million) and Swords Enterprise Park (guide price €11.5 million). Taken together, the offering makes up about 447,000sq ft of accommodation and generates income of about €3.15 million, representing an overall net initial yield of 6 per cent.

Given the diversity of the assets in terms of location, tenant mix, income term and asset management strategies that could be deployed, the properties are being made available for sale individually or as a single lot sale.

Cloverhill Industrial Estate comprises some 210,000sq ft of industrial and warehousing accommodation and represents what the selling agent says is an “excellent opportunity” to drive investment value in the short term, by undertaking a refurbishment programme on about 85 per cent of the facility when the landlord takes back possession of units 1 and 3 from Primeline VNE Ltd in April 2022. The remaining 15 per cent of the scheme is occupied by Broderick Bros Limited on a lease that offers a rent review in November 2023 and a mutual break option in November 2025.

Galway park

Mervue Business & Technology Park occupies a prime location in Galway and is recognised as one of the city’s longest established business and manufacturing parks. Units 20-29 comprise one manufacturing unit and one office unit, which are leased to HID Global Ireland Teoranta and Avaya International Sales Ltd respectively. HID’s premises have been extensively modified following a deep retrofit and rebuild programme. Practical completion is imminent, clearing the way for the tenant to take possession on its lease, which has almost 13 years unexpired.

Avaya International Sales Limited has just completed substantial upgrade works to its office premises in units 25-29 at a cost believed to be in the region of $1.7 million, despite a break option in December 2022 on a portion of its space.

Swords Enterprise Park is a modern and well-managed development comprising 61 units, 33 of which are light industrial units and the remaining 28 own-door office properties. The development has a prime location overlooking the M1 motorway and benefits from easy access to the M50, Port Tunnel and Dublin Airport. While occupancy levels at the scheme are already very high, at about 93 per cent, there is “excellent potential”, according to the selling agent, to increase rental income as vacancies and rent reviews arise.

Commenting on the sale of the Novelty portfolio, Siobhán Convery of Harvey says: “This is a very exciting collection of mainly industrial investment properties which, as a single lot or individual lots, offers investors a really attractive mix of investment opportunity. There is excellent potential to create added value through a variety of asset management strategies in the short term, whilst having the benefit of secure income for almost 13 years from HID and its US parent HID Global Corporation.”