Middle Estern investors are to buy the PwC headquarters on Dublin's North Wall Quay for €242 million. The building is Ireland's largest single office investment.
The London-based AGC Equity Partners, who advised the successful bidders, completed legal contracts to buy One Spencer Dock only hours before the poling booths closed in Britain’s EU referendum.
The record-breaking sale is expected to give an important boost to the Dublin office market amid speculation that several major financial institutions maywell relocate from London to Dublin following the UK’s vote to leave the EU. Irish investment funds are currently developing a string of new office blocks mainly in the city centre in the expectation of attracting overseas companies.
The Spencer Dock investment drew considerable overseas interest when it was first offered for sale last October onbehalf of Nama. The US property dealer Hines, with the support of German pension funds, had been expected to buy the property at the same value of €242 million but surprisingly pulled out of the deal at the end of April after almost three months of negotiations and due diligence.
Complex
The nine-storey over basement PwC office complex is the largest in the city with an overall floor area of 21,054 sq m (226,624 sq ft). The three interlinking blocks were developed in 2007 by the now defunct Treasury Holdings which folded with debts of € 2.7 billion.
One of Treasury's principals, Johnny Ronan, is back developing high value office blocks in the south inner city.
The waterfront PwC hq is let to the company under 25 year leases with upwards only rent reviews every five year. The leases have around 15 years to run. The overall rent is reported to be in excess of € 11 million per annum-probably working out at around € 538 per sq m (€ 50 per sq ft). PwC has sub let some of its office space to the US-based United Health Group (UHG) as well as to ABN Amro and Ecclesiastical Insurance. UHG is to pay close to the ongoing rent level for almost 4,180 sq m (45,000 sq ft) over four floors in Block C. Its lease will run for ten years.
One Spencer Dock was built on land owned by CIE and under a development agreement the State transport company was to have a 17.5 per cent interest in the freehold. The Davy fund moved swiftly to buy out CIE’s interests for around € 20 million and when the overall sale is completed shortly it will move to claim its share of the investment.
The sale was handled by Fergus O'Farrell of Savills and Johnny Horgan of CBRE.
