Saturday 25 November 2017

Green REIT to spend up to €58m on Cork offices

An artist’s impression of the new quayside building, which is due to open early next year in Cork City
An artist’s impression of the new quayside building, which is due to open early next year in Cork City

Daniel McDonald

Property investment group Green REIT has agreed to spend up to €58m for 15,400 sq m of office space in Cork City.

The real estate investors said that they have entered into a conditional contract to acquire One Albert Quay in Cork city centre.

The building is under construction by local developers JCD Group, and is expected to be ready for use early in 2016.

Pre-letting agreements worth €2.1m annually have already been reached for 54pc of the office space.

Fire protection and security solutions firm Tyco will lease 7,000 sq m for its new global headquarters over a 20-year period.

Meanwhile, professional services network PricewaterhouseCoopers has committed to a 1,300 sq m tenancy over 15 years.

At full occupancy, the property is expected to yield between €3.6m and €4.1m in yearly rent.

Chief executive Pat Gunne said: "We are delighted to announce the acquisition of what will be Cork's best office building and the first major city centre office development in Cork for over a decade.

"The yield premium over Dublin is attractive, particularly with the Cork office rental market at an earlier stage in the recovery cycle.

"We look forward to working with JCD Group in the period ahead to secure further high quality tenants for the remaining space in One Albert Quay."

The investment will cost Green REIT between €55m and €58m, subject to letting position at the final payment.

This will be structured on a phased basis with the final instalment to be made in Q1 2017.

The acquisition is being funded through the company's revolving credit facility with Barclays Bank Ireland.

Green REIT listed on the Irish Stock Exchange in July 2013, and hit a record high earlier this year when it was added to the FTSE global real estate index.

The company declared a pre-tax profit of €73.4m for the six months to the end of December 2014 and paid shareholders dividends of 0.92c per share in March.

Shares were unchanged by the Albert Square acquisition, and opened at 1.5950 on Friday.

Irish Independent

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