Hibernia Reit and US investor Starwood Capital could join forces in the redevelopment of the Windmill Lane Studios site after the listed property vehicle completed two deals for €27 million yesterday.
The company said it paid €20.16 million for the loan secured on the Hanover Building at Windmill Lane in Dublin’s south docks and that it also acquired the adjoining site for €7.5 million.
Hibernia did not name the vendors. However, KBC Bank owned the loan over the Hanover building, which it acquired when the building’s developer, Liam Carroll’s property empire collapsed in 2009. The site next to the Hanover Building was Windmill Land Studios, where U2 began their recording career, but which now occupy a building next to Ringsend bus garage.
US investor Starwood acquired the site last year from State agency Nama, which sold it as part of Project Aspen, a portfolio of loans linked to property player and former Superquinn shareholder, David Courtney.
The one-acre development site comes with mixed use planning permission for 125,000 sq ft of office space, 15 residential units and 9,000 sq ft of retail.
12-month option
Hibernia said it had granted an unnamed party a 12-month option to invest on a “side by side, equal cost” basis in the combined redevelopment of the two properties. It is understood the party is the vendor, Starwood. If this comes to fruition, Hibernia will be both asset manager and development manager in the project.
The Hanover building is a five-storey, modern office development that includes close to 45,000 sq ft of office space on upper floors as well as 11,600 sq ft of retail space at ground level. The offices are occupied by BNY Financial Services, with a tenant option to break the leases in 2016. Eurospar occupies the retail space under a lease running to 2032, with a break option in 2019. The building generates €1.5 million in rent per annum, with the purchase price implying a net initial yield of 7.3 per cent.
The docklands off-market transactions bring to seven the number of acquisitions agreed by Hibernia since it listed at the end of last year.
