THE OFFICE of Public Works (OPW) has secured a €1.1 million or 50 per cent rent reduction on the Government building that houses the passport office in Dublin.
Minister for Public Expenditure Brendan Howlin has confirmed the State was paying an annual rent of €2.2 million for the upper floors of the building on Dublin’s Molesworth Street which also houses Oireachtas staff in the year to the end of February 2011.
However, following negotiations with the property’s owner, the Irish Airlines Pension Ltd, the State has achieved a rent reduction of €1.1 million and is now paying annual rent of €1.1 million on the building.
The property had an upward- only rent clause on its lease that is due to expire in August 2014 and figures provided by Mr Howlin in response to a written Dáil question by Peadar Tóibín TD (SF) show the OPW has secured rent reductions totalling €2 million on 31 separate properties since February 2011. The OPW owns 2,000 properties across the State and an OPW spokeswoman said yesterday the office had “achieved adjustments on rents across the property portfolio”.
The reduction in rent on the Molesworth Street building is one of four properties where the OPW has secured reductions of about 50 per cent in the past 12 months.
Commenting on the €1 million reduction secured by the OPW, director of offices with property firm Savills, Roland O’Connell, said the office “did better maybe than they should have done. It was very good work done on behalf of the taxpayer.”
Mr O’Connell said the OPW had a very strong covenant with landlords, as landlords knew the Government would pay its bills.
According to Minister for State at the Department of Finance Brian Hayes, who has responsibility for the OPW, annual rental expenditure paid by the office “peaked in 2009 at €131 million, but by 2011 the figure had reduced to €117 million and, by the end of 2012, I expect the annual out-turn to have reduced even further, to a figure of €112 million”.
Mr Hayes added: “My office successfully negotiated 21 downward rental reviews during the year 2011 with over 357,000 sq ft of office space surrendered in 2010 alone and I am confident that this trend will continue, given this country’s changed economic circumstance.
“OPW’s rent reduction strategy will be pursued aggressively in the coming years,” he said.
