Ardstone agrees to buy €48m block in the UK
Irish investment firm Ardstone has agreed terms to spend £40m (€48m) on an office block in Birmingham.
The firm has placed Victoria Square House under offer in the city, and will take it over from F&C Reit Asset Management.
Ardstone are believed to have beaten a host of investors to the 160,000 sq ft property including Deutsche Bank, Scottish Widows Investment Partnership and Legal & General.
Law firm DLA Piper is the major tenant, occupying 54,000 sq ft.
This is the latest major deal to be completed by Ardstone in recent months, as it looks to take advantage of the relatively cheap prices available for commercial property at the moment.
In September it spent £33.7m to buy the Citymark Building in Edinburgh from Irish Life, as well as another £25m on the Sentinel building in Glasgow.
In October, Ardstone spent €8.85m to take over the South Dublin residential development the Annaville Residence.
The tenant with the most space at the scheme is law firm DLA Piper, which occupies 54,000 sq ft. The property was close to being sold to Nurton Developments and Moorfield Group in 2010, but the owner decided to pull the sale and negotiate a re-gear with DLA that was completed last year.
Meanwhile Ardstone has joined up with property agents CBRE to spend close to €100m in the Irish market over the next five to seven years.
CBRE Global Investors have signed a deal with Donal O'Neill and Donal Mulcahy's Ardstone to acquire commercial property primarily in Dublin, but also across the rest of the country as opportunities arise.
This is the second time the global multi-manager (GMM) division of CBRE GI has agreed a joint venture. It will be looking mostly at office, retail and industrial properties, which "offer value-add returns to institutional clients of CBRE GMM".
Terms of the agreement were first reported by Property Week.
The fund's first purchase was the Fleming Court office block on Mespil Road, in south Dublin, which cost €9.75m, which was finally confirmed last week.
The 29,800 sq ft multi-let office building was built in 2002 and is let to six tenants including Beachcroft Solicitors, Kennelly Tax Advisors and St James Place.
Commenting on that sale, Ardstone co-founder Donal O'Neill said: "This asset is located in a highly sought-after market, which has seen significant investment and letting activity recently.
"Fleming Court is very well rented at current market rents and gives our fund a 7 per cent annual income return.
"We also see great asset management potential to improve the asset which will not only add value to the property but will benefit our tenants in the long term.
"We are buying into the beginning of the rental growth cycle in Dublin and we hope to add further investments to this one very soon."
CBRE Global Multi Manager chief Jeremy Plummer said his firm sees "great opportunities in the Irish market and are pleased to have joined up with Ardstone again who are able to find quality, off-market deals like Fleming Court".
"They have the know-how in the Irish market which is consistent with our approach of investing with local specialists."
Ardstone was set up by former Friends First real estate veterans Donal Mulcahy and Donal O'Neill.
The firm has been notable for being one of the few Irish investors to successfully avoid the property crash.