The US private equity firm Blackstone is to sell on the Hume House office building on Pembroke Road in Ballsbridge, Dublin 4, just over 12 months after buying the distressed asset from Nama.
Johnny Horgan of CBRE is inviting offers in excess of €40 million for the block, which is expected to be demolished and replaced by an office complex more than double the present size.
Blackstone's decision to flip on the investment so soon after acquiring it as part of the Platinum portfolio will be closely monitored by other overseas investors who have assembled substantial portfolios over recent years and are uncertain as to when to put them back on the market. Earlier this week, Blackstone also sold another office investment from the same portfolio – Central Quay, off Sir John Rogerson's Quay, which like Hume House had been owned by developer Sean Dunne. Hibernia REIT paid what is considered a strong price (€51.3 million) for the 5,360sq m (57,700sq ft) block which will lose its view of the Liffey when a vacant site in front of it is developed.
Vet college site
Hume House adjoins the 2.02-acre former Veterinary College site which is currently being developed as a major new urban centre by the Comer Group to include more than 46,400sq m (500,000sq ft) of offices, apartments and retail facilities as well as a leisure centre. The building that will replace Hume House could very well form the centrepiece of an even larger mixed development to be carried out by a consortium headed by Joe O'Reilly's Chartered Land.
It will include 490 apartments, a 152-bedroom hotel, 7,154sq m (77,000sq ft) of retail and associated commercial space.
Both projects should allow Ballsbridge to become the number one choice for working and living in the city.
The planning for Hume House will allow for a redevelopment of the entire site which extends to 0.35 of a hectare. It provides for the demolition of the existing block and its replacement by a six-, eight- and nine-storey buildings with 16,900sq m (181,909sq ft) and 53 car parking spaces.
Rent roll
An alternative , but unlikely option, would be for the next owner to upgrade the building and increase the rent roll of €2.1 million by finding tenants for vacant space.
However, most of the accommodation is already committed, much of it to AIB and Bank of Ireland as well as Audi. The Pearse Trust also rents space here but is due to move out in June.
Full vacant possession of the block can be obtained in 2017 to facilitate redevelopment under the existing planning permission.
Developer Seán Dunne bought Hume House in 2006 for €130 million as part of a larger site assembly plan in Ballsbridge.
Johnny Horgan said the € 40 million asking price would provide a yield of 5 per cent and based on the planning permission would work out at “€220 per buildable square foot”
