Green Real Estate Investment Trust (Reit) is close to letting part of a high-profile Dublin office block that is near completion to leading corporate tenants.
The property investor said yesterday that the value of the offices and industrial buildings it owns rose 4 per cent to €1.48 billion on December 31st from €1.424 billion six months earlier.
Green is close to completing the 9,400sq m I Building in its Central Park complex in Sandyford on the southside of Dublin. Pat Gunne, chief executive of Green Property Reit Ventures, indicated the company was close to signing tenants for two floors of the new building.
“We are already in legal discussions in relation to two floors of the building,” he said. He added that interest from potential tenants in the remainder of the property was “encouraging”.
Mr Gunne said that, as negotiations were not complete, Green was not in a position to name the businesses that were looking to become the I Building’s first tenants. However, he pointed out that most tenants in its Sandyford development tended to be well-known corporate names.
“I would say it will be more of the same in terms of what we have delivered there to date,” Mr Gunne added.
Completing buildings
Green is spending €600 million on further developing its properties. It will complete two further buildings at its Horizon Logistics Park, next to Dublin Airport, during the first half of this year adding an extra 5,400sq m of space.
Meanwhile, the company has begun work on purpose-built premises for distributor and contract services group Bunzl.
Green also owns One Molesworth Street in Dublin's city centre, whose tenants include Barclays Bank, which recently got a London court's approval to move €190 billion in assets to the Republic ahead of Brexit.
Green said profit for the six months to December 31st, the first half of its financial year, fell almost 15 per cent to €45.6 million from €53 million during the same period in 2017.
The profit was split roughly 50/50 between gains from rental income and the increase in the valuation of its properties.
Mr Gunne explained that the fall in profits reflected a greater contribution than previously from rental income than from increases in its properties’ value.
Rental income for the six-month period rose 2.1 per cent to €34.4 million from €33.7 million in 2017. Green’s contracted annual rent had risen 4 per cent to €74.4 million over the six months to the end of December.
Basic earnings per share fell 14.6 per cent to 6.5 cent in the first half to 7.7 cent. The company is proposing to pay investors an interim dividend of 2.8 cent a share, against the 2.6 cent paid this time last year.
Total returns to shareholders for the year to December 31st, based on dividends and the increase in its properties’ values, were 12.6 per cent, compared with 13.4 per cent for the year to June 30th.
Green Reit chairman Gary Kennedy said the company was well positioned to take advantage of further opportunities.
“While we remain alert to the prevailing wider economic and political uncertainty, Irish commercial real estate, particularly our sectors of focus, offices and logistics, continues to perform well,” he added.
