Irish Life Investment Managers has completed the sale of Block A, Riverside IV in Dublin – a prime office building located at Sir John Rogerson's Quay in Dublin's south docklands – to German investor Deka Immobilien Investment GmbH for about €164 million.
Developed originally by Sean Dunne, Riverside IV is a seven-storey over basement building comprising 12,355sq m (133,000sq ft) of grade A office space with more than 65 metres frontage to the River Liffey.
The developer sold the property in 2006 in part exchange for the Irish Life-owned Hume House next to his extensive former Jurys hotel site in Ballsbridge. Riverside IV was valued at the time at €170 million while the 7,432sq m (80,000sq ft) Hume House had a sale price of €130 million.
In 2009, and in the depths of the financial crisis, Irish Life offered a 50 per cent stake in Riverside IV to the market at a guide price of €50 million. While a willing Irish purchaser soon emerged, the company ultimately decided not to sell, citing the emergence the following year of an improving investment climate.
The sale of the property now to Deka comes just over one year after Matheson, Ireland's largest law firm, committed to a new long-term lease of the entire building. In April 2020, and at the height of the Covid-19 pandemic, the company provided a significant boost to the Dublin office market when, rather than exercise a break option on Riverside IV, it signed a new 12-year lease on the property at a rent of €55 per sq ft.
Matheson’s original 25-year agreement ran from 2007 and provided for a break option in year 15, which would have allowed it to surrender its lease on its Dublin docklands headquarters with minimal or no penalty in 2022.
Deka Immobilien has been among the most active purchasers in the Irish office and hotels market in recent years. Last year, it acquired the Baggot Plaza property, which Bank of Ireland has been renting since 2015, from Kennedy Wilson for €165 million, and purchased the Clayton Hotel Charlemont from Dalata Hotel Group in a sale-and-leaseback deal for €65 million.
In 2019, Deka acquired the Marker hotel in Dublin for €134 million, adding to its collection of other Irish hotel assets, which includes the Clayton Hotel Burlington Road and the Gibson Hotel. The German-headquartered investor entered the Dublin office market in late 2019 with the purchase of the Reflector office building in the city's south docklands for about €155 million.
Irish Life Investment Managers (ILIM) are Ireland's largest property investment manager, with more than €3 billion of Irish property assets under management.
Commenting on the completion of the sale of Riverside IV, Martin O’Reilly, head of property at ILIM said: “Riverside IV has generated an excellent return for our investors following significant value-add lease restructuring. This competitive off-market sale process and strong pricing demonstrates strong market liquidity and confidence in the outlook for commercial property in Dublin. We remain committed to the market and continue to increase exposure to city centre offices by way of our development pipeline, which includes 70 St Stephen’s Green and Cadenza on Earlsfort Terrace.”
Irish Life were advised on the transaction by Savills Ireland.