UK firm to pay €20m for Cineworld facility

Two groups of Irish investors taking advantage of buoyant market to sell Dublin property

A British company involved in the leisure business is to pay close to

€20 million for the largest and most successful cinema complex in the State: the Cineworld facility on Dublin's Parnell Street. The figure is €4 million below the asking price.

The facility has been owned by two groups of Irish investors for the past 15 years.

Max Reilly of agent Jones Lang LaSalle yesterday declined to confirm the sale, saying it would be premature to make an announcement at this stage.

The investment is producing a rent of €1.9 million for the 22 Irish owners who bought it in 1998, when it carried valuable tax allowances.

The two consortiums are availing of the buoyant investment market to offload the city-centre property.

Rent review
The new owner will be hoping to increase the overall rent roll because of an outstanding rent review on about half of the cinemas. The leases on the cinemas have more than 12 years to run.

The Parnell Street sale comes after the owners of the St Stephen’s Green Shopping Centre secured planning permission to develop 10 cinemas on the roof of the centre.

The €10 million project had been expected to be well under way at this stage but there are no signs of it proceeding so far.

The cinema and leisure complex has 17 screens in all, including a new Imax facility, with a total of 3,360 seats at four different levels.

It is operated by Adelphi-Carlton, an Irish subsidiary of the UK-based Cineworld group, which had a turnover of €13.5 million and a profit of about €2 million before interest, taxation and depreciation on its Dublin operation in 2011.

The facility is one of the top-five performing cinemas in Britain and Ireland, with about 1.4 million admissions last year.

Cinemas have traditionally been favoured by investment groups because of their stable income and the fact that these businesses are less affected by recessions.

Cineworld accounts for 49 per cent of all cinema screens in Dublin and has an overall floor area of 10,962sq m (118,000sq ft) over four levels.

It has direct access to a 500-space car park.

The cinema complex includes a 1,300sq m (14,000sq ft) basement. It was recently let to a leisure operator at a stepped rent of €60,000, which is to rise to €70,000 after three years.

The original foyer on the ground floor extends to 287sq m (3,100sq ft) and is currently vacant.

Retail units
Five substantial retail units fronting on to Parnell Street and backing on to an inner mall, owned by the centre's developer, Belfast-based Peter Curistan, were put into receivership in 2010 at the request of Anglo Irish Bank.

Four of the units are understood to be producing about €350,000, while the fifth remains vacant.

The Parnell Street complex had 10 screens when it opened as Virgin Cinemas in 1998.

It later traded as UGC and then as Cineworld. In 2002 it was extended and refurbished at a cost of €15 million, when seven additional screens were added, along with a new foyer, bar and concession area.

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