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An Post may pay €5m annual rent for its new parcel centre

The state postal service is seeking a new logistics unit in Dublin

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It’s only three years since An Post opened its Dublin Parcel Hub in Knockmitten

It’s only three years since An Post opened its Dublin Parcel Hub in Knockmitten

It’s only three years since An Post opened its Dublin Parcel Hub in Knockmitten

Increased online commerce has resulted in An Post deciding to seek additional storage and sorting space in the Dublin region.

It has instructed agents TWM and Savills to source a new logistics unit extending to 500,000sqft on about a third of an acre of land for use as a processing and distribution facility.

The preferred location will be within easy access of the M50 and An Post says it will consider all potential opportunities which have the required access to road networks and flexibility of site size.

The move comes as both prime and secondary rents in the sector are continuing to rise. One expert says rents for prime logistics increased by 7.6pc in the last year to €11.25 per sqft, while another says that due to a shortage of space, rents for secondary space rose to €8.50 per sqft over the last six months.

Then there is the risk of construction cost inflation. This suggests An Post may be facing the prospect of annual rent of between €4m and €5m.

It is only three years since An Post opened its 538,000sqft Dublin Parcel Hub, a €15m investment in automated parcel processing at Oak Road, Knockmitten, Dublin 12. It caters for national and international parcels and marked a milestone in An Post’s transformation from an old world of letters to a new world of e-commerce logistics.

In 2015, it sold its south Dublin docklands sorting office in a €40m deal and moved its services for the Dublin 1, 2 and 3 districts to a new sorting office at Ravensdale in the north docklands.

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