South Korean fund emerges as highest bidder for docklands offices

A South Korean institutional investor is closing in on a deal to buy the second of five office buildings being developed in the Dublin docklands by Sean Mulryan's Irish property company, Ballymore, and its Singapore partner Oxley.

The Asian fund has emerged as the highest bidder, at around €105 million, for No 2 The Landings, which attracted at least five bidders: two Korean and three European.

Selling agents Knight Frank and CBRE were quoting €98.8 million for the investment, which is expected to show a net initial return of about 4.5 per cent. The building has been prelet to the international services office provider WeWork on a 20-year lease with no break options.

The initial rent will be about €4.822 million, reflecting an average rent of €511.6 per sq m (€47.53 per sq ft). The lease provides for a fixed increase at the first review to €5.327 million.

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The spectacular eight-storey office building has an overall floor area of more than 9,245sq m (99,513sq ft) and 23 car parking spaces. It is at the rear of the first block, No 1 The Landings, adjoining the recently completed Central Bank headquarters and the spacious PwC building.

The block overlooks the new Central Square and is finished to the highest specifications, including 4-pipe fan-coil air conditioning and a full-height atrium with three panoramic 21-person lifts.

WeWork is one of the world’s leading serviced office operators, with a reported value of $20 billion.

The Dublin Landings development will also include three further office blocks currently under construction to provide an additional 28,700sq m (308,926sq ft) of office space.

The sale of No 1 and No 2 The Landings at significantly more than the guide prices will be seen as an important endorsement for Ballymore, which has completed some of the most spectacular office and apartment developments in the UK over the past three decades.

Ballymore's success with the first of The Landings blocks was greatly helped by the fact that the first tenant was a State agency, the National Asset Management Agency.

It also holds a 20 per cent equity stake in the entire docklands development.