Two German businessmen have bought an office and retail investment in Dublin city centre for €22.5 million – €15 million less than the asking price.
Davy handled the purchase of St Martin’s House on Waterloo Road, Dublin 4, for the new owners who can bank on an initial return of 13.26 per cent and possibly more depending on some new rental arrangements.
The sale brought to almost €600 million the turnover in the Irish investment market in 2012. Several of the transactions, with an end value of €165 million, are still in legals.
Outlook
All the indications are that the turnover in the coming 12 months will easily exceed last year’s figure, largely because of the likely sale of assets held by Treasury Holdings, the insolvent property firm that was headed by Johnny Ronan and Richard Barrett.
Nama has already taken control of a range of properties held by the company. The firm has total debts of €2.7 billion on its extensive portfolio which includes Stillorgan shopping centre and some of the most high profile office blocks in the city. The investment market expects the various properties will be sold individually because of their broad appeal.
Savills handled the sale of the Waterloo Road property for FC Reit Asset Management (formerly Friends First) which is expected to use the funds to avail of new investment opportunities.
St Martin’s House dates from the 1970s and is producing a rent roll of €3.56 million. Donal O’Sullivan of Savills, who handled the sale, said the building would provide interesting management opportunities for the new owners.
Upgrade
The planned changes are expected to include an upgrading of the retail units on the ground floor, which extend to 985sq m (10,601sq ft) of space.
The five overhead floors include 6,054sq m (65,073sq ft) of office space. There is a running track on the roof – probably the only one at this level in the city. A two-tier car park to the rear has 156 spaces – one car-parking space per 485sq ft; new office buildings generally have one space per 3,000sq ft.
Most of the office space is shared between the National Roads Authority (NRA), the Mental Health Commission and Truvo Ireland, publishers of Golden Pages. The lease held by the NRA runs until 2016 while the other main tenants have leases extending to 2022.
The rents are considerably higher than the going rate in the city, from €502 per sq m (€46.66 per sq ft) to €532 per sq m (€49.48 per sq ft). The highest rent of all at €538 per sq m (€50 per sq ft) has been paid for a 668sq m (7,200sq ft) unit rented by agent Spain Courtney Doyle.
