Monday 20 August 2018

Revenue Commissioners mull Dublin Landings move

No. 2 Dublin Landings, which is pre-let to WeWork, has secured an offer of around €105m
No. 2 Dublin Landings, which is pre-let to WeWork, has secured an offer of around €105m
Ronald Quinlan

Ronald Quinlan

Developer Sean Mulryan's Ballymore, and its Singapore partners Oxley, are understood to be in talks with the Office of Public Works (OPW) with a view to securing the Revenue Commissioners as the third major tenant for Dublin Landings, the one million square foot mixed-use scheme they are developing in the Dublin Docklands.

The Irish Independent understands that the OPW's property management team is seeking office space capable of accommodating several hundred Revenue personnel who are based across three locations currently.

Should an agreement be reached between the parties, the Revenue Commissioners would be the second State agency to locate at the Dublin Landings development, following the lead of the National Treasury Management Agency (NTMA).

The NTMA's decision to rent the entirety of No 1. The Landings, helped to drive the capital value of the property when it was put up for sale last October. The building attracted 10 bidders - one Irish, four European, one Middle Eastern and four Asian, before being sold to German institutional investor Triuva, for €164m.

The pre-letting of No 2, The Landings, to global co-working operator, WeWork would also appear to be paying off for Ballymore and its partners. Having offered the building to the market in May for €98.8m, joint selling agents CBRE and Knight Frank have reportedly secured an offer of around €105m from a South Korean institutional investor. The Asian fund is understood to have fended off rival bids from at least four other parties: one Korean and three European. Based on its expected selling price, No 2. is expected to deliver a net initial return of about 4.5pc. WeWork is to occupy the building on a 20-year lease with no break options. While the initial rent will be set at €4.822m, reflecting an average rent of €511.6 per sq m (€47.53 per sq ft), the lease provides for a fixed increase at the first review to €5.327m.

Located next to the new headquarters of the Central Bank of Ireland at North Wall Quay, the overall Dublin Landings development extends to 93,000 sq m (1,001,043 sq ft). In addition to Nos 1 & 2, a further three office blocks will be developed on the site providing a further 28,700 sq m of space. The construction of all three buildings is underway with a view to making them available for occupation in 2019. All told, Dublin Landings will comprise 298 apartments, offices, restaurants, bars, retail, and landscaped gardens. Some 6,000 people are expected to work and live at the docklands scheme once it is finished.

While the Ballymore scheme is vast, it is just one of several major mixed-use developments either underway or planned for Dublin's North Wall Quay and its immediate environs. Developer Johnny Ronan's Ronan Group Real Estate (RGRE), is delivering a one million square foot mixed-use scheme at nearby Spencer Place, while US-headquartered real estate firm Kennedy Wilson is, as the Irish Independent revealed last Saturday, set to acquire City Block 3 (CB3), a 5.91 acre site to the rear of the Central Bank's new headquarters at North Wall Quay. Located to the rear of the Central Bank and Dublin Landings, the site is recognised as one of the last remaining prime development sites in the Dublin Docklands and its strategic development zone (SDZ).

CB3 comes with full planning permission for the development of 347 residential units on 1.44 hectares (3.55 acres), and a pending planning application for an office-led mixed-use scheme of 30,890 sq m (332,497 sq ft) distributed across a 0.95 hectare (2.35 acre) site.

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