6th November (Issue 171)
Welcome to the Origin Capital Weekly Irish Property Review. This update is designed to provide you with a full recap of the latest property news from the media over the last seven days.
RETAIL
Dublin 1 Portfolio Joint agents Lisney and Knight Frank are guiding €13m for seven properties (c40,000 sq.ft) on O’Connell Street, Abbey Street and Sackville Place. The portfolio generates €518,279 pa and 55% of the floor space available is vacant. The O’Connell Street properties comprise two adjoining buildings on Lower O’Connell Street (20,235 sq.ft) let to Londis, Dublin Tourist Office and Paddy Wagon Tours with vacant upper floors. 4&5 Lower Abbey Street (7,500 sq.ft) are partially let to Ladbrokes Bookmakers and Madigan Public house with vacant upper floors. The Sackville Place properties extend to 11,500 sq.ft The Irish Times, 31st October
O’Connell Street, Dublin 1 The Irish Times reports that as plans are being finalised for the redevelopment of Clery’s department store, IPut have sold 47/48 O’Connell Street, a 9,761 sq.ft property let to Schuh Footwear at €480k pa for €7.6m (6.3% GIY). It is also reported that Irish Life intends to sell the former Clarks Building (10,207 sq.ft) for €5.5m or lease it for €275k pa. The Irish Times, 31st October
Tuam Shopping Centre, Galway TWM agents are seeking €1.25m for the anchor supermarket unit in Tuam Shopping Centre Galway. The 20,236 sq.ft unit is current occupied by Joyce’s Supermarkets on a 10 year lease from 2010 with a passing rent of €150,000 pa (11.06% NIY) The Irish Independent, 5th November
OFFICE
The Hive, Sandyford Construction work has commenced on The Hive, a 73,000 sq.ft office block in Sandyford. HWBC are quoting rents of €34 psf. The property is being developed by U+I Group and Colony Capital and will form part of a pipeline of 250,000 sq.ft of office space in Dublin. The Irish Times, 31st October
Docklands, Dublin The Irish Independent reports that Google are bidding to purchase two more buildings in the Docklands; South Bank House and The Warehouse, which are located beside their European HQ on Barrow Street. The Irish Independent, 6th November
Grove Road, Dublin 6 Sales agent Acres are seeking €3.3m (€413 psf) for a 7,981 sq.ft, four storey office building along with 11 car spaces overlooking Portobello bridge in Dublin 6. The Property is let to a language school with current annual rent of €207,500 increasing to €239,400 in year 5. The Sunday Business Post, 4th November
Eastgate, Galway McDonagh Capital Investments has lodged planning permission for the first phase of Eastgate office campus, a €50m suburban office campus to the east of Galway city. The first phase will comprise 187,649 sq.ft across three blocks. It is intended to provide Eastgate in three phases including offices, hotel and public plazas. The Irish Times, 31st October
Cushman & Wakefield Q3 Report Office Report notes 858,422 sq.ft of office space was occupied in Q3 2018 in Dublin, 18% higher YOY, and brings the 2018 total to 1,967,105 sq.ft across 169 deals. The report notes that subleases are becoming more prominent, with tenants committing to longer term expansion by committing to more space than is currently required. Tech companies are the key drivers of the growth but flexible office workspace take up has grown from sub 1% in 2014-2016 to 9% in 2018 to date. The space under construction has increased by 4% to 4,373,377 sq.ft across 42 schemes, 16% ahead of the previous cycle’s peak in 2006 and 215,278 sq.ft shy of the record high in 2001.
HOTEL / LICENSED PREMISES
The Old Stand, Dublin 2 The Doran brothers have sold their leasehold interest in the Old Stand Pub in Dublin 2 for €3m. This sale brings the total number of Dublin pub sales in 2018 to 18 with a combined value of €33m. The Old Stand’s 35 year lease from 1997 from Dublin City Council is €122,500 pa with a right to renewal. Separately, John P Younge Auctioneers, is also selling Davy Byrnes at 21 Duke Street on behalf of the Doran brothers. Best and final bids are due 22nd November. The Irish Independent, 1st November
RESIDENTIAL / LAND
Rathgar, Dublin 6 Colliers International has launched two newly built 1,400 sq.ft, three storey, semi-detached homes on Kenilworth Lane East in Rathgar for €750,000 and €730,000 respectively. The Sunday Business Post, 4th November
Belgrave Collection Orange Capital Partners, a Dutch company, has purchased the Belgrave collection, a portfolio of 30 redeveloped Georgian properties in Dublin 4, 6 & 8 for more than €60m. The portfolio comprises of 46 studio apartments, 85 one-bed apartments, 29 two-bed apartments and five three-bedroom homes and had originally been bought by Lugus Capital. The Sunday Times, Irish Edition, 4th November
Mount Merrion, Dublin 4 Knight Frank are seeking €32m (€17m per acre) for 1.88 acres in Mount Merrion. Part of the site on the western side has planning permission for 48 apartments and 3,035 sq.ft of offices while part of the eastern side of the site has further planning permission for 50 apartments and a 12,529 sq.ft pub and restaurant. The Irish Independent, 1st November
Sandyford, Co Dublin Cushman and Wakefield are seeking €36m (€9.4m per acre) for 3.81 acres with planning permission for 459 apartments directly opposite the Stillorgan Luas stop in the Sandyford Industrial Estate. Development guidelines have changed since the five year planning permission was granted in July 2018 and it is thought that the number of apartments could be increased to 539 (€67k per site). The Irish Times, 31st October
INDUSTRIAL
Industrial Space JLL report that 1m sq.ft of industrial space was taken up across 36 deals in Q3 2018, a 92% increase on the take up in Q2 2018. The average deal size in Q3 was 29,862 sq.ft. The largest deal in Q3 was the sale of 219,853 sq.ft located at Lufthansa, Naas Road. The Irish Independent, 1st November
LOAN SALE
Bank of Ireland Loan Sale The Sunday Business Post reports that BOI are in negotiations with potential advisors regarding a loan sale of non-performing loans. Earlier this year, CEO, Francesca McDonagh noted the bank would consider selling some of the bank’s €5.9bn bad loans. The Sunday Business Post, 4th November
GENERAL
CBRE Bi Monthly Report November 2018 notes prime office rents in the city centre are €65 psf, €28.50 psf in south suburbs, €19.50 psf in north suburbs and €17.50 psf in west suburbs.
The report notes that while the Irish retail market has resisted the negative European trend, CBRE anticipates it will slow in the next two months before Christmas allowing for retailers to focus on the Christmas trade. Prime retail rents are €604 psf in Grafton Street, €437 psf in Dundrum, €418 psf in Henry Street, €279 psf in Blanchardstown, €255.50 psf in Liffey Valley, €139 in the Square in Tallaght, €93 psf in secondary city centre, €35 psf for prime retail warehouse, €15.70 psf for secondary retail warehouse and €12 psf for provincial prime retail warehouse.
Total returns in Irish commercial property increased by 6.9% in the first nine months of 2018 and €2.67bn has been invested in the Irish market in the same period. Prime yields are 3.15% for retail (high street), 4% for retail (super prime shopping centres), 4% for office and multifamily BTR residential, 4.75% for retail (prime shopping centres), 5% for warehouse, 5.10% for industrial and 5.25% for student accommodation.
12 hotel transactions totalling €263m along with one hotel investment sale totalling €17.5m has occurred in the first three quarters of 2018.
€940m across 105 development land transactions have been signed in the first nine months of 2018.
Industrial take up in 2018 has reached 2,260,419 sq.ft in the first three quarters. Prime Dublin rents are €9.85 psf, €6.25 psf for secondary Dublin and €5.80 for prime provincial.
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