Property investment vehicle Hibernia Reit has paid €20.16 million for the loan secured on the Hanover Building at Windmill Lane in Dublin's south docks and has also acquired an adjoining site for €7.5 million. It plans to redevelop both properties.
The Hanover building is a five-storey, modern office development that includes close to 45,000 sq ft of office space on upper floors as well as 11,600 sq ft of retail space at ground level. The offices are occupied by BNY Financial Services, with a tenant option to break the leases in 2016. Eurospar occupies the retail space under a lease running to 2032, with a break option in 2019.
The building generates €1.5 million in rent per annum, with the purchase price implying a net initial yield of 7.3 per cent.
The adjoining 1-acre development site comes with mixed use planning permission for 125,000 sq ft of office space, 15 residential units and 9,000 sq ft of retail. Hibernia said it had granted an unnamed party a 12-month option to invest on a “side by side, equal cost” basis in the combined redevelopment of the two properties. If this comes to fruition, Hibernia will be both asset manager and development manager in the project.
The docklands off-market transactions bring to seven the number of acquisitions agreed by Hibernia since it listed at the end of last year. The group has so far committed €253 million to property deals.
