The fast-changing office market in Dublin's north docklands is expected to trigger competitive bidding for two office investments at East Wall Road which were developed by the Collen Group in the late 2000s and are now for sale by private treaty.
Joint agents JLL and Savills are guiding €32 million for One and Three Gateway, two standalone blocks which will provide a net initial yield of 6.23 per cent.
The two buildings extend to 8,807sq m (94,800sq ft) and have 71 car parking spaces at basement level. The rental income of €2,080,000 equates to €226 per sq m (just under €21 per sq ft) which is expected to rise in the coming years in line with other rent reviews in the north docklands.
Rents in Eastpoint Business Park, on the opposite side of East Wall Road, are now generally running at €269 per sq m (€25 per sq ft).
The weighted average unexpired lease term in the Collen development is 4.1 years while the capital value, based on the asking prices, works out at €338 per sq ft.
Sell separately
As well as the overall guide price of €32 million, the selling agents are also prepared to sell the two blocks separately. One Gateway, priced at €18 million, is producing a rental income of €1.17 million from tenants ESB, Whirlpool, Colt and Galvanic, who share 4,784sq m (51,500 sq ft) over six floors. The five-storey Three Gateway has a floor area of 4,022sq m (43,300sq ft) which is rented solely by the ESB at €915,000 per annum.
Internally, the Gateway offices are finished to a high standard, with raised access floor, suspended ceilings, LED light fittings, air-conditioning, meeting rooms and staff facilities.
Each floor level is served by two 10-person passenger lifts. More than 90 per cent of the floor areas have undergone high-quality fit-outs in the last 12 months.
The East Wall Road has witnessed major changes in recent years with a range of retail traders moving in, including Lidl, Aldi, McDonald’s, Centra, Spar and Starbucks.
Considerable interest
The north docklands is currently experiencing a considerable level of investment with the new Central Bank HQ nearing completion and the Dublin Landings also in the pipeline. East Wall Road is also close to the Convention Centre, Spencer Dock and the Point Village.
Declan Sexton of JLL said the East Wall Road sale was a “fantastic” opportunity for an investor to gain a foothold in the Dublin office market with high-quality buildings, excellent tenants and obvious reversionary potential.
Brendan Delaney of Savills said he expected strong levels of interest from investors given the level of activity in the north docklands area, the exceptional quality of the buildings going for sale, and the tenant line-up.
