Real estate giant seeking €40m for Dublin logistics portfolio

Real estate private equity giant Palm Capital has instructed Lisney and CBRE as joint agents to find a buyer for the Orbital portfolio, a collection of four prime logistics assets distributed across Dublin. Extending across a gross external area of 21,249sq m (228,723sq ft), the portfolio, which is fully let to a strong tenant line-up, is being offered to the market at a guide price of €40 million.

The Orbital portfolio comprises Building 1, Damastown Close, Damastown Industrial Park, Dublin 15 (leased to West Pharma); 100 Northwest Business Park, Dublin 15 (leased to the Oasis document storage group); 15 Magna Drive, Magna Business Park, Dublin 24 (leased to services provider Actavo), and 48 Furze Road, Sandyford Industrial Estate, Dublin 18 (leased to Jaguar Land Rover motor dealership).

In terms of income, the portfolio is currently generating approximately €2.24 million in annual rent, supported by an attractive weighted average unexpired lease term (WAULT) of 13.89 years (8.39 years to break options).

Rent reviews in 2025 and 2028 across the portfolio are projected to increase the annual rental income to more than €2.6 million, with two of the assets (Damastown and Northwest Business Park) having the benefit of uncapped CPI (consumer price index) rent reviews that will capture the post-Covid surge in inflation and significantly enhance returns.

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Dublin is widely recognised as having one the strongest outlooks in Europe for logistics rent growth, owing to the ongoing and significant imbalance between the supply and demand of warehouse space in “last-mile” industrial locations across the city.

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CBRE’s 2024 European Investor Intentions Survey found that the majority of investors now believe the European logistics sector has little or no further downward pricing to come, whilst the logistics sector was also ranked as the most favourable asset class for investors to acquire in 2024, up from third place in 2023.

Palm Capital’s move to dispose of the four assets within the Orbital portfolio comes just over six months after the announcement, by its subsidiary Palm Logistics, of its intention to develop a further 500,000sq ft of logistics space at Naas Enterprise Park. This is the largest single asset in the Core industrial portfolio, which Palm Capital acquired with KKR for €195 million in December 2021.

The proposed expansion, which will see the 250-acre park’s logistics space increase to more than 2 million sq ft, will involve an investment of more than €100 million. As part of its plan to reposition the scheme, Palm also decided to rebrand the development as Momentum Logistics Park.

Palm Logistics’ move to rebrand and develop additional logistics space at Naas Enterprise Park followed on from its sale for more than €100 million of two of the three warehouses at Greenogue Logistics Park in west Dublin to Ingka Investments, the investment arm of Ikea’s largest franchisee, the Ingka Group. Completed in 2022, the 450,000sq ft logistics scheme was Palm’s first speculatively developed logistics park in Ireland.

In October 2022, Palm Capital and KKR paid €17 million for Cloverhill Industrial Estate in Clondalkin, Dublin 22. The sale represented the third and final disposal of the assets offered for sale in November 2021 as part of the €48 million “Novelty Portfolio”, a mix of industrial and office properties distributed across three locations in Dublin and Galway.