One of Dublin's largest office developments has been sold in an off-market transaction and a wealthy Far Eastern investor is the new owner of the Eir headquarters near Heuston Station after buying it for €176 million.
The current annual rent of €9.3 million will rise in July by way of a fixed uplift to €10.9 million. The investment will show a yield of 5.7 per cent when the higher rent comes into effect.
Commercial agent BNP Paribas Real Estate is believed to have brokered the deal between the US owners, Northwood Investment Corporation, and the unnamed investor. The sale of "HSQ" could well trigger a recovery in sales, which have been slow since the end of last year.
The eight-storey building extending to 21,000sq m (226,040sq ft) and has parking for 210 cars at Heuston South Quarter. It was funded and developed by the former State company then trading as Eircom. It was sold at the end of 2006 – two years before the property crash – to Quinlan Private for a figure reported by The IrishTimes to have been €190 million. The sale and leaseback arrangement formed part of a 25-year full repairing and insuring lease effective from July 2008.
Distinctive
Subsequent turmoil in the property market as a result of the banking crisis allowed Bank of Scotland Ireland (Lloyds) to offload the HSQ building. The investment was bought by Northwood for an undisclosed figure.
Eir’s lease of the distinctive block is due to run until 2033, giving the new owner a weighted average lease period of 15 years, with the next five yearly review due this July.
The Eir headquarters adjoins an even more spacious development by Galway's Padraig Rhatigan and Goodbody's Private Clients Fund. Adjoining occupiers to Eir in the Brunel building include the HSE, Tusla and AOL, while SuperValu and a range of retail outlets are also trading in the larger campus alongside the owners of 350 apartments. The development also includes two levels of basement car parking.
The sale of HSQ will be the third largest office investment sale in Ireland since the property boom first got under way. In June 2016, Middle Eastern investors paid €242 million for the PwC headquarters at North Wall Quay. A year earlier Germany-based Union Investments bought the Facebook office at Grand Canal Square for €233 million.
