Friday 28 April 2017

Double-digit yields are in prospect at four auctions

QC House in Cork
QC House in Cork
Leitrim Observer offices
Hammond Marsh House in Cork
Retail premises in Leixlip

Donal Buckley

More than 210 properties will be offered for sale in four bumper auctions to be held within the next three weeks.

Thursday, November 3, looks set to be the busiest day and some bidders may be tempted to bid at all three auctions scheduled, as the largest of them is an Allsop online auction with 140 commercial and residential lots with combined reserves of over €20m.

DNG is organising another two: a Leinster auction of eight dwellings at Leopardstown Racecourse and a Munster auction in Cork with more than 30 properties.

A week earlier, Sherry FitzGerald will auction 34 commercial, residential and development properties from Dublin and around the country on October 26, with combined values of €4.3m.

A number of investment properties with double-digit yields will go under the hammer.

The highest yield of 47pc is suggested by Allsop's valuation of the offices of the 'Leitrim Observer' newspaper in Carrick on Shannon.

After the two-storey, mid-terraced 3,907 sq ft premises failed to sell at auction last month, its guide price has been slashed from around €340,000 to between €115,000 and €125,000.

Located at Unit 3, Block A, Hartley Business Park, Carrick-on-Shannon, its contracted rent is €57,138 a year, but the lease has a break clause which would allow the tenant to move on in 2018.

Reflecting the recovery in Cork's office market, a three-storey, detached office block at Cork Business & Technology Park has a guide price in the €950,000 to €1,050,000 range.

Known as QC House and located off Model Farm Road, the vacant building extends to 17,728 sq ft. This is the equivalent to a capital cost of €56.40 per sq ft.

Allsop will also auction five multi-unit residential properties with guide prices ranging from €565,000 to €1m and gross yields of around 10pc.

The most valuable of these comprises 15 houses, at 1 to 15 Lough House View, Tullamore, Co. Offaly, which have a €900,000 to €1m guide price.

All but one of these are let, generating combined current rent reserved of €86,292 a year, suggesting an initial gross yield of 9.08pc.

Ranging in size from 950 sq ft to 1,172 sq ft, units 1 to 7 are two-bedroom terraced bungalows, units 8 to 14 are three-bedroom terraced houses and Unit 15 is a detached, three-bedroom bungalow.

A multi-family investment comprising of 11 two-bedroom apartments at 1 to 11 Kilronan Apartments, Dublin Road, Dundalk, Co. Louth, has a €900,000 to €950,000 guide price.

They are generating €98,400 in annual rent, suggesting an initial gross yield of 10.63pc. Arranged in two detached blocks, the flats range in size from 721 sq ft to 893 sq ft.

A Cork City Centre portfolio of seven apartments at Hammond Marsh House, 7 Henry Street, generates a rent of €69,900 a year and at their guide price of between €770,000 and €780,000 suggest a gross yield of 9pc.

A terrace of four Dublin houses at 23 Longs Place, and 2, 3, and 4 Forbes Lane, between Cork St and James St, Dublin 8, have a €575,000 to €625,000 guide price.

Three of the houses have two bedrooms and generate €13,200 each a year in rent. The fourth, at 4 Forbes Lane, is a vacant, three-bedroom house.

Allsop auctioneer Richard O'Neill believes that the four have the potential to generate combined annual rents of €75,000, suggesting a potential gross yield of 12.5pc.

Two mixed-use investments on Collins Avenue, Dublin 9, are for sale with modest guide prices. Of these, No. 390 Collins Avenue, Santry, has had its guide price reduced from €550,000 earlier this year to a guide between €375,000 and €395,000.

It comprises a retail unit at ground floor trading as a Gala store, at a rent of €40,400 per year and two vacant two-bedroom apartments overhead which have own-door access.

Mr O'Neill says if the apartments were let, the property has the potential to generate €60,000 a year, suggesting a possible gross yield of about 15.58pc.

At the Beaumont section of Collins Avenue, No. 110 comprises a four-bedroom, mid-terrace house together with an adjoining end-of-terrace motor workshop and carwash facility.

It has a total current rent reserved of €31,200 a year and, with its €340,000 to €360,000 guide price, suggests a gross yield of 8.9pc.

An office property on the busy 15 Chelmsford Road thoroughfare in Ranelagh, Dublin 6, has a €340,000 to €355,000 guide price.

It is considered to have residential development potential as the single-storey terrace unit extends to 1,851 sq ft and has rear access. It has a contractual rent of €12,000 a year, but the lease is due to expire in 2018.

On October 26, the Sherry FitzGerald Cushman and Wakefield auction includes a two-storey retail investment at Captain's Hill, Leixlip, Co. Kildare with a €220,000 AMV - which is a reduction from the €275,000 sought at an auction earlier this year. Currently leased to Tuthills Newsagents, the 3,003 sq ft premises generates rental income of €29,100 per annum, suggesting a gross initial yield of 13.2pc.

A slightly higher yield of 13.9pc is suggested by Unit 3, Block C, Santry Business Park, Swords, Co. Dublin, which has a €180,000 guide price.

It is a mid-terraced industrial unit with two-storey office extending to 3,326 sq ft and is leased to Advanced Therapy Systems on a three-year lease at a rent of €25,000.

A lower 10.3pc yield is suggested for a restaurant investment at 1 Selskar Avenue, Wexford Town, which has a €175,000 AMV. The building extends to 2,852 sq ft and generates €18,000 in annual rent.

The top price in this auction is for one of two Cavan quarries which offer a punt on the expected upsurge in construction activity. The largest of these is Carricknaveagh Quarry, Bailleborough, which has a €500,000 AMV. Its lands extend to 93.9 acres, with the working quarry making up 20.76 acres.

A smaller quarry at Killyvanny, Ballyhaise, Co. Cavan, has a €250,000 guide price.

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