Thursday 26 April 2018

Hibernia REIT reports 'good' progress on lettings

Kevin Nowlan, CEO of Hibernia REIT
Kevin Nowlan, CEO of Hibernia REIT
Ellie Donnelly

Ellie Donnelly

Hibernia REIT has said that “good” progress has been made on its lettings, with its in-place office portfolio vacancy rate reduced to 7pc.

The vacancy rate will fall to 2pc if all space currently under offer completes, the group said in a trading update today.

In Dublin, Hibernia reported record office take-up of 3.5m sq. ft. last year, after a new quarterly high in the three months to 31 December.

The group sold three assets for €35.8m, while earlier this month Hibernia announced that it had agreed the purchase of 77 SJRQ in Dublin’s South Docks for €28.7m, which it has already let out on a 25 year lease. Initial rent on the building will be €1.8m per year.

"With a favourable letting market, a strong balance sheet to exploit opportunities and an experienced team, we are optimistic for the future," Kevin Nowlan, chief executive of Hibernia, said.

Commenting on the update, Colm Lauder, Real Estate Analyst with Goodbody, said that the group’s sale of Hanover Street East/11a Lime Street to - he understands - M&G backed developer Marlet for €12m was small but noteworthy.

"We estimate that this asset was valued at around €6m at the time of [the group’s] last results, having been purchased for €4.6m in May 2015," Mr Lauder said.

"The represents a return on cost of around 260pc. This is a key example of the Hibernia management team’s creative asset spotting and management ability."

At 31 December 2017 Hibernia had net debt of €182m and cash and undrawn facilities of €263m following the disposal of the Chancery building.

Hibernia’s Sir John Rogerson's Quay and Windmill Lane developments in Dublin are both on schedule for 2018 completions, with the group confirming that discussions are ongoing with potential occupiers.

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