New Ireland on move to renovated D2 offices
NEW Ireland Assurance is to move back into its former offices in the centre of Dublin, in what is one of the most significant lettings of the year so far.
New Ireland is taking up all of 5-9 South Frederick Street, which was being let by Paul Scannell of HWBC Chartered Surveyors.
The life and pensions giant has signed a 20-year lease on the entire 22,500 sq ft building.
The lease will incorporate a break option after 10 years at an initial rent of €25 per square foot and €3,000 per car space.
Excluding parking that equates to annual rent of €565,000 per annum.
There are 10 car spaces on site.
New Ireland had been the main tenant in the building for several years but had consolidated much of its operations into its Dawson Street HQ.
The deal is a significant one as it is one of the first major deals involving a renovated office bock in the prime Dublin 2 area.
With vacancy rates plunging there is now a shortage of Grade A office buildings in the centre of the city.
The IDA has been one of many voices warning that the city and Ireland as a whole could lose out on valuable international investment if foreign multinationals can't find suitable accommodation in Dublin.
The fully refurbished first generation building has been completely upgraded to Grade A standard including raised access floors and air conditioning.
The premises was constructed in the Sixties and HWBC says the extensive works carried out to modernise the building include the installation of shower facilities and secure bicycle parking.
The property also features a renovated reception area and stone cladding to a number of walls.
It is believed there was strong interest in the building with at least one major real estate business among the suitors for the property.
For New Ireland's part, the move is expected to allow for increased expansion of its business in Dublin, where it employs some 700 people already.
The success of this property is likely to be closely watched within the industry.
With new office construction still constrained – there are only a handful of projects around Dublin and just one of real significance in the city centre – refurbished premises are being seen as one of the few viable options for the market as a whole at present.
Even with the refurbishments, office rents are still climbing steadily.
Top-level grade A office space can be had for around €35 per square foot – right on the limit of what makes new construction a viable proposition.
That rate is expected to go even higher though, with many industry analysts forecasting rents to move as high as €40 a foot this year.
Davy Stockbrokers meanwhile have said rents may eventually touch €50 a square foot, moving back towards levels not seen since the peak of the boom in the last decade.
The South Frederick Street building is one of several first generation properties that have had to be renovated to make them attractive to tenants today.
With changes in technology, employee expectations, and even things as basic as floor plans, tenants' demands today differ hugely from even 15 years ago, never mind the middle of the last century.
Sunday Indo Business