Monday 14 October 2019

Kilmainham offices go on offer with €32m price tag

Flexible: One Kilmainham Square generates annual income of more than €2m
Flexible: One Kilmainham Square generates annual income of more than €2m
Donal Buckley

By Donal Buckley

AVESTUS Capital Partners and its joint venture partner Ares Asset Management are looking to sell the last of the three office buildings which they acquired in 2016.

Their agent Knight Frank has set a €32m guide price for One Kilmainham Square in Dublin 8, a Grade A office building which generates annual income of €2.07m.

Adrian Trueick, of Knight Frank, says a sale at the guide price would provide an attractive return of 6pc with potential to increase the yield in the short-term by letting a vacant office suite of 393 sq m.

In addition, if rent reviews on the first, second and third floors in early 2020 were agreed at the levels of recent lettings, the yield could increase to 7.25pc.

Occupiers include Heineken, Parexel Pharma and Klas Telecom with a weighted average unexpired lease term of about 7.3 years, with 5.62 years to break term.

The property is held in a fund managed by Avestus Capital Partners, which acquired it as part of a portfolio that in turn had been part of the Liffey Collection. That Avestus deal was for more than the quoted price of €45m and included two other office properties at 51-54 Pearse Street and Magennis Court. Those two were sold earlier this year for €27.2m.

So the current sale price for Kilmainham One could generate a gross profit of about €10m for the Avestus fund and Ares.

Kilmainham One is located close to Heuston Station, about 3km from the city centre, with easy connectivity by rail, tram and bus to all parts of the city and surrounding suburbs.

This part of the city is undergoing rapid change with new developments in Dublin 8 including the proposed St James's Gate Quarter, the extension of Heuston South Quarter and the new children's hospital.

Kilmainham One was developed by John Lally's company Lalco in 2008 and it was originally let to Amazon.

Lalco also developed the nearby Hilton Hotel which was subsequently purchased by Tifco Group, which sold its hotels portfolio to Apollo Global Management.

Kilmainham One extends over five floors with basement car parking.

Externally, the block has glazed elevations incorporating a striking "floating" stone cladding system with stone clad brise-soleil and extensive terraces at fourth-floor level.

A full height, glazed atrium with feature link-bridge over the atrium void, creates a light-filled entrance to the offices.

The building design uses structural steelwork to achieve 16-metre clear spans, reducing the need for internal columns.

Its accommodation therefore provides bright, flexible office floors, which are capable of sub-division.

The flexible floor plates are C-shape, with a central service core/amenity space.

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