A fully occupied office building

opposite the entrance to Holles Street hospital in Dublin 2 goes on the market today with a price tag in excess of €12 million.

The Holles Street block was owned since the late 1990s by property investor Patrick Rocca who died unexpectedly at the age of 42 in January, 2009.

Brendan Delaney of Savills is handling the sale for receivers Kieran Wallace and Cormac O'Connor of KPMG.

Holybrook House, a five-storey over-basement building, is producing a rent roll of more than €900,000, reflecting an average rent of €263 per sq m (€24.50 per sq ft). At that level, the rent is only marginally above the going rate for a building of this quality in such a prime location off Merrion Square.

Roof-mast income
The block is let in its entirety to three key tenants, Pobal, the Open University

and Office of Public Works with an average unexpired lease term in excess of 11 years. Further rental income comes from roof masts let to 02, Meteor and Vodfafone.

The largest proportion of the rent, €633,400, comes from Pobal, a not-for-profit organisation with charitable status that manages various funding programmes on behalf of the Government. The OPW pays a rent of €174,000 while the Open University contributes €55,000. The university’s lease of 232sq m (2,500sq ft) on the ground floor is due to expire at the end of February, 2015.

Delaney says that in the longer term a new owner might consider redeveloping the regular-shaped rectangular site which extends to 0.24 of an acre.

Assuming about €12.25 million for the investment – a price that would provide a yield of 7 per cent – he says the block will work out at a value of €5,941sq m (€552 per sq ft).

Recovering market
"At this price level the investment looks very attractive to savvy investors who are anticipating a marked recovery in the Dublin office sector over the next three years."

Delaney said he was anticipating strong interest in the investment given the high profile location.