Thursday 26 April 2018

Telephone House for sale with €11.5m guide price

Telephone House is close to O’Connell Street and transport links, including the new Luas link
Telephone House is close to O’Connell Street and transport links, including the new Luas link
Sarah McCabe

Sarah McCabe

Telephone House, the Dublin city centre building long associated with Eircom, has been put up for sale with a guide price in excess of €11.5m.

The 1970s office block is situated on Marlborough Street in Dublin 1, just east of one of one of the capital's main thoroughfares, O'Connell Street.

The property is being sold by agent Knight Frank.

Telephone House is currently leased to Indian-headquartered multinational HCL, which is contracted to provide customer and technical support services to Eir (formerly Eircom).

With a passing rent of €968,084 per annum or €10.46 per square foot it offers investors a net return in the order of 8pc, Knight Frank said, after standard acquisition costs of 4.46pc are considered.

HCL (Ireland) Information Systems Limited is renting the building under a ten year full repairing and insuring lease that began in July 2015, guaranteed by HCL EAS Limited, a UK entity. It is also paying around €2,000 for each of the building's 61 car parking spaces annually.

There are also two telecommunication mast licences producing an additional €16,000 per year.

The lease provides for a rent review at the end of the fifth year and tenant break options on September 30 2021 and September 30 2023, subject to a six-month notice period.

The tenant is entitled to assign or sub-let the entire building or any part of it to Eir or any of its subsidiaries, on the condition that Eir provides a guarantee.

The office block, once owned by Ben Dunne, is situated close to many public transport routes and is walking distance from Busaras and Connolly and Tara street train stations. Its connectivity should be further enhanced once construction of the Luas Cross City line is completed, linking the southside Green Line to the northside Red Line.

The southbound tramway of the Cross City line will travel down Marlborough Street and a Luas stop will be built within 50 metres of Telephone House.

The nine-storey property was developed in the late 1970s/early 1980s and includes a partial basement. Refurbishment of the building was undertaken in 2004.

The total net floor area is 7,504.1 square metres (80,773 square feet) with typical floor plates of around 883 square metres (9,500 square feet) which could be further sub-divided if desired.

The building's 61 car parking spaces provide a car parking ratio of one car space per 123 square metres.

Ross Fogarty of Knight Frank said the property has a significant amount to offer investors.

"The opportunity presents investors with a very attractive medium term return prospect.

"In addition to same there are strong value-add credentials when one considers factors such as the low base rental level with scope for significant rental uplift, the buildings efficient and flexible open plan floor plates, a strong parking provision, a highly accessible location with an abundance of amenities, a locale that is ripe for large scale investment and regeneration and longer term refurbishment /conversion potential."

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