Friday 18 January 2019

Iconic Clerys department store sale sees interest from furniture giant Ikea

An artist’s impression of the proposed redevelopment of Clerys’ former department store
An artist’s impression of the proposed redevelopment of Clerys’ former department store
Ronald Quinlan

Ronald Quinlan

Clerys' flagship department store premises on O'Connell Street may yet secure a new lease of life as a destination for Dublin shoppers following an expression of interest in the property from Ikea. understands the Swedish furniture giant is just one of a number of parties to have explored the possibility of acquiring the iconic property from the Natrium Consortium, which is headed up by businesswoman Deirdre Foley.

A source familiar with the matter said yesterday that personnel from Ikea's global property team had met with Ms Foley personally in recent weeks and undertaken a 'walk through' of the Clerys building.

Contacted for comment on Ikea's potential interest in the O'Connell Street property, a spokeswoman for Ikea's Irish operation said: "Ikea is committed to growing and investing in Ireland. We are always looking for opportunities and are investigating the potential for a second store in the market, specifically in Cork. However, we have no confirmed plans for the development of an Ikea store at the moment."

First round bids for the Clerys building are due to be submitted early next week. Having acquired the property in 2015 for €29m, Natrium is understood to have expectations of securing a price in the region of €60m following the conclusion of the sale, which is being handled by Knight Frank.

While it remains unclear if Ikea will partake in the process, which has been code named 'Project Surf', there will be no shortage of interest in the premises given the fact that both it and adjoining sites already have planning permission in place for a major mixed-use development comprising retail, a boutique hotel, office space and entertainment and leisure facilities.

The first round of bidding for the Clerys' department store building is set to be followed up with the launch of its adjoining block at Nos 14-18 on O'Connell Street to the market for a guide price of between €14m and €15m.

Natrium's decision to sell the Clerys portfolio represents a dramatic change of course to the one which the consortium had been pursuing earlier this year when it engaged the services of Knight Frank, Savills and CBRE to secure office and retail tenants and a hotel operator as part of its plans to progress with the redevelopment of the famous department store.

As part of that process, Knight Frank were instructed by Natrium to find occupiers for the office element of the ambitious scheme, while Savills were tasked with sourcing retailers.

CBRE, for its part, was retained to advise Natrium on the selection of an operator for the scheme's boutique hotel, which will be located to the rear of the former department store on Earl Place.

Developer and Press Up Entertainment chief Paddy McKillen Jr is one of up to 30 parties interested in operating the scheme's hotel, while both the acclaimed US Italian-themed restaurant chain, Eataly, and the leading London restaurant operator, Rhubarb, held talks with Natrium in relation to the operation of Clerys' proposed rooftop dining area.

The Belfast-born owners of New York's famous Dead Rabbit bar are also understood to have expressed their interest in opening a venue within the redeveloped department store.

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