A further round of substantial rent increases - some of them as high as 120 per cent - is on the cards for Dublin's premier high street, writes Jack Fagan
Dublin's Grafton Street looks set to hold on to its reputation as one of the most expensive high streets in the world.
Traders are facing another round of substantial rent increases following the disclosure yesterday that Bewley's Cafe is facing a rent rise of 93 per cent - from €750,000 to almost €1,475,000 per annum. Meanwhile, McDonald's is also facing a rent increase of 120 per cent.
The Campbell Bewley Group (CBG), which leases the extensive café from a subsidiary of Treasury Holdings, would not be drawn yesterday on whether the higher rent would affect its operation.
A spokesman said the café "is operating normally and there is no reason for us to comment on the matter over and above that". He also said that the terms of the recent rent review "are entirely confidential as far as we are concerned".
The new rent level was set at arbitration after a three-day hearing. Senior counsel for Bewley's apparently argued that, because of the new planning control system in Grafton Street, restaurant rents should be lower than retail rents.
Neither Michael Harrington of agent HWBC, who represented the Treasury subsidiary, Ickendel, nor Donal French O'Carroll of CBRE who acted for Bewley's, were available for comment yesterday.
Bewley's has a floor area of about 1,486sq m (16,000sq ft) including 418sq m (4,500sq ft) on the ground floor. The company trades off three floors, using some of the space as a franchisee for Cafe Bar Deli.
The new rent will be backdated to January 1st, 2007. The previous rent review showed an increase of 59 per cent.
The Treasury subsidiary initiated court proceedings last year seeking the forfeiture of CBG's lease after the catering group rejected an offer of €6 million to relinquish it.
Treasury believes that the building could be more profitably let as a fashion store. The café was closed for a short period in 2004 and reopened the following year when it was run for a period by Jay Bourke and Eoin Foyle of Cafe Bar Deli. CBG has since regained full control of the business.
Grafton Street was named last year as the world's fifth most expensive street in which to run a business. Retail experts say that, with many traders facing rent increases of between 75 and 100 per cent in the coming months, the street could edge up even higher on the list. Most stores are now run by international multiples rather than indigenous traders who can no longer afford the high rents.
In recent weeks, First Active has had the rent of its premises at the junction of Grafton Street and Suffolk Street increased from €457,000 to €1.05 million. It sublets a retail unit on Suffolk Street to Carrolls and overhead office accommodation to several companies.
McDonald's fast food outlet at 9-11 Grafton Street is facing a staggered rent increase of 120 per cent - from €520,000 to more than €1.1 million.
Negotiations on the new rent level have been concluded between Sean McCormack of DTZ Sherry FitzGerald (acting for landlords Royal Liver) and Maura Farrell of Lambert Smith Hampton who was advising McDonald's.
At least a dozen other traders are facing rent reviews in the coming months, including: Dubray Books, who pay a rent of €350,000; 02 who have a rent bill of €380,000; Boots, who pay €558,000; Nine West who pay €359,500; Ernest Jones, whose rent is €400,000; and Card Gallery who pay €283,000. BT2 is also up for a rent review shortly and Laura Ashley, who has a rent bill of €700,000, is seeking a new lease which will come with a substantially higher rent.
