THE ESB Superannuation Fund is to finance the first phase of an office development at Ballsbridge, Dublin 4, for around £12.8 million. As part of the deal, the fund is to sell an office investment at 7/8 Wilton Terrace, Dublin 2, to G. & T. Crampton, which owns the site of the proposed office scheme at Shelbourne Road, Ballsbridge.
It is understood a valuation of around £4 million has been placed on the 23-year-old office block at Wilton Terrace, which is occupied by National Irish Bank.
The ESB fund has agreed to finance two office blocks with a total of 54,500 square feet of space. A third block of 41,500 square feet will be developed and retained by Crampton.
The development of the first two blocks will begin next month and will be completed by April, 1998. With rents expected to range between £16 per square foot and £18 per square foot, the investment is expected to produce a yield of about 7 per cent for the ESB fund.
Under the development agreement, Crampton will construct the building, providing top quality office accommodation with third-generation specification. This will include raised floors, capacity for air-conditioning and a high standard of finish. Parking will be provided at a ratio of one per 1,000 square feet of offices.
John Mulcahy of Jones Lang Wootton handled the negotiations for Crampton and Brendan O'Donohoe acted for the ESB fund.
David Crampton, managing director of G. & T. Crampton, said the company was delighted to have the fund as investors as it would allow Crampton to develop the last section of what was a prime site.
Crampton is currently building 48 luxury apartments on another part of the site. All the units were sold within two days of going on the market with the exception of 14 apartments, which are being retained by Crampton.
The Galway developers, O'Malley Construction, built and sold more than 100 apartments and townhouses on the remainder of the site.
The Wilton Terrace office block being bought by Crampton is let to National Irish Bank under a lease which does not run out until the year 2008. The bank is paying a rent of £12 per square foot for the 24,000 square feet of space and £1,000 per annum for each of the 30 car-parking spaces. The ESB fund bought the building about five years ago from the Goodman group.
The decision of the ESB fund to finance a modern office development was not unexpected because of its policy to reduce exposure in the older office market.
