CIÉ is to avail of the strong demand for office sites in Dublin city centre and enlist a partner to develop a high-rise office block alongside Tara Street Dart Station and George’s Quay.
The move comes as a range of developers and investment funds are pitching for suitable city centre locations now that the demand for office space has soared again and top rents are even higher than during the property boom.
Instead of selling off the site of around one-third of an acre, CIÉ is anxious to lock in to an income stream with the successful developer who will handle the planning application and build out the project.
The State transport company is prepared to either grant a 300-year ground lease or take 10 per cent of the annual rental income from the proposed building, whichever is the higher.
Depending on the size of the office block approved for the site, a developer getting permission for, say, 9,290sq m (100,000sq ft) of office space and renting it at €538 per sq m (€50 per sq ft) could expect to pass on €500,000 a year to CIÉ from the €5m rent roll.
Ross Shorten of Lisney, who is advising CIÉ, said they were expecting a good response from office developers in particular but also from others given the wide range of uses that would be permitted in such a central area like ground-floor retail, a hotel and a residential element as well as offices.
Under the George's Quay local area plan, Dublin City Council may allow a development of up to 22 storeys in height even though An Bord Pleanála refused Siptu permission in November 2012 to demolish Liberty Hall on the opposite side of the Liffey and replace it with a 22-storey tower that would have been 35 per cent higher.
The board claimed that the proposed building would have seriously detracted from the setting and character of the Custom House. It also argued that the scale and height of the building would be unacceptably dominant in the city.
CIÉ had better luck with the planning authorities in 2010 when it secured permission to redevelop Tara Street station and provide a nine-storey office block on top of a three-storey concourse.
The office content alone was to have been 8,400sq m (90,415sq ft). The project was abandoned because of the currency crisis and the property crash though the planning permission is still valid for another five years.
In the meantime, CIÉ has upgraded the Dart station and made provision for any future expansion of its transport services.
Tara Street station is already handling more than 20 per cent of all rail passengers on the daily Iarnród Éireann network.
“The office site is now surplus to CIÉ’s requirements,” according to Mr Shorten. “The block to be built there is likely to be a landmark office development, offering some of the best views over the city centre and along the docklands.”
The site extends to 0.135 of a hectare (0.33 of an acre) and currently houses Tara House, a rundown office block which was originally developed by the Irish Press Group.
It was subsequently owned by Jude Publications before being sold to CIÉ.
Lisney is inviting initial tenders by April 22nd.
