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Thursday 27 October 2016

Dublin service stations to market for close to €8m

Published 30/04/2015 | 02:30

The Applegreen station in Baldoyle which is being offered for sale
The Applegreen station in Baldoyle which is being offered for sale

Two Applegreen service station are being put on the market for a combined €7.8m.

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Knight Frank have been retained to source a buyer for the two stations, which would yield around 6pc.

The stations are being offered at guide prices of €3m and €4.8m

The investments, which are let for terms of 21 and 25 years, are located on Sarsfield Road Inchicore and Grange Road, Baldoyle and produce a current income of €190,000 and €300,000 per annum respectively.

Both properties are let to Petrogas Group Limited on full repairing and insuring leases. The leases, which do not have any break options, provide a guaranteed 10pc increase in the rent each fifth year.

Petrogas operate 75 Applegreen service stations in Ireland and 34 in the UK. In September 2010 Applegreen opened and now operates Ireland's first 6 Motorway Service Stations and continue to expand in Ireland with six further sites due to be developed this year.

The leases are guaranteed by the parent company, Petrogas Global Limited.

The Baldoyle Service Station is located on the south side of Grange Road close to the entrance to the Baldoyle Industrial Estate. Grange Road is a principal thoroughfare linking Sutton and Baldoyle with Donagmede and on to the Northern Cross / M50 motorway. The Inchicore station is located on the south side of Sarsfield Road opposite Longmedows Park. Sarsfield Road links Ballyfermot and Inchicore, with access onto the Chapelizod By-Pass and the city centre. Sarsfield Road is a main commuter route with a high volume of passing traffic.

Both properties comprise a modern forecourt with four double pump islands, a convenience store/deli and car wash. The Grange Road station has a restaurant operated as a Subway.

With a combination of long term secure income and guaranteed rental uplifts in line with projected inflation, the investments offer a very attractive cash flow and would be particularly suitable for a private pension fund. The initial return at 6.00pc, rising to 8.50pc over the term is a significant premium on standard annuity or deposit rates.

Petrogas Global achieved a 63pc increase in profits for 2013 while revenues climbed by more than 10pc. Reported turnover in 2013 totalled €804.5m, with operating profit rising to €10.6m. As of the end of last year, gross assets were valued at €168.3m and shareholders' funds were €44.4m.

KnightFrank's Adrian Trueick said the forecourts will give investors a chance to buy high profile stations let on long term leases to a very strong covenant.

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