The intense competition for shops on Dublin's Grafton Street will surface again shortly when Lyons Irish Holdings sells its leasehold interest in the Dunkin' Donuts outlet at the junction of Grafton Street and Harry Street. Agents McCabe Crisp and Partners are likely to secure a premium in excess of £300,000 for the building, which will be of interest to a range of Irish and UK multiples.
The decision by tea company Lyons Irish Holdings not to renew its franchise means that it is also to sell by tender its leasehold interests in Dunkin' Donuts units at The Square in Tallaght, the Swan Centre in Rathmines, and Ballyfermot Shopping Arcade.
With many UK multiples still looking for shops on Grafton Street because of the buoyant retail market, Patricia Crisp of the selling agents says they are confident of finding a strong covenant to replace Lyons.
Most of the demand is still coming from UK fashion traders who want an outlet in Dublin's premier shopping street. Retail specialist Fintan Tierney of agents Lambert Smith Hampton (LSH) says that apart from the UK traders, LSH had inquiries from US and German companies who want to open shops in the street.
Some of the US inquiries are coming from designer fashion houses - these are thought to include Ralph Lauren and DKNY - who will only settle for the best pitch in each European Capital.
UK pharmacy chain Boots is known to be anxious to get a large shop on the street, though the Dunkin' Donuts outlet is much to small for its requirements. Boots is understood to have been willing to pay key money of over £1 million for the former Marks & Spencer store on the street but a deal was not agreed and the 12,000square-foot building is now trading as a Christmas shop for Brown Thomas.
Dunkin' Donuts will be of particular interest to fast-food operators because the unit already has an established food use. Lyons Irish Holdings spent substantial funds refurbishing the building, which has over 3,000 square feet on five levels, 849 on the ground floor and 389 on a mezzanine. The first floor of 730 square feet can also be used as a restaurant or for retail.
The Friends Provident building is currently rented at £106,000 but the basement is sub-let to Brussels bar at £11,000 per annum. The next rent review for the entire building is due in September, 1998, and the tenant can exercise a break option in the year 2008.
Although strong premiums have been available for shops on Grafton Street over the past three years, there has been a relatively small turnover of traders. Two years ago, Brown Thomas paid key money of £300,000 for the Shree store; the Guinness clothing store paid a premium of £250,000 for the Swamp premises and fashion trader Gymboree paid £280,000 for opticians McNallys.
With few opportunities available in Grafton Street, multiples looking to open in Dublin are now being forced to pay premiums for premises in Henry Street. The Clarks shoes sister company, Ravel, agreed to pay a premium of £150,000 for an outlet in Henry Street after it failed to find premises in Grafton Street.
Apart from Grafton Street, Dunkin' Donuts will also be disposing of two units of 1,130 square feet units in The Square and The Swan Centre, which are rented at £36,000 and £23,500, respectively. The 959-square-foot restaurant in Ballyfermot Shopping Arcade is rented at £19,000 per annum.
