THE ESB Pension Fund has sold another Dublin office investment as part of its programme of upgrading its portfolio. Friends Provident has paid the fund, slightly under £5 million for a building its occupies at 29/31 Adelaide Road.

The deal would have produced a yield around 7 per cent had the fund completed a rent review, which was overdue.

Finnegan Menton acted for the fund and Lisney represented Friends Provident.

The 23-year-old block, which overlooks the Grand Canal, was producing rents of £325,000 from 25,460 square feet of office space and 58 car-parking spaces. The original lease was held by the National Mutual Life Association of Australia, which was taken over in the early 1990s by Friends Provident.

The 35-year lease on the Adelaide Road block dates from 1989. The current rent of £11 per square foot was expected to move to at least £12 on review while the charge for car spaces was likely to be increased from £700 to £1,000.

Friends Provident is planning to upgrade its newly-acquired building and to link it with an adjoining building, which it owns. This block, number 31, was occupied mainly by Project Management until it moved to Tallaght.

Friends Provident plans to use both buildings as its Irish headquarters.

The ESB fund has been cutting back on its exposure in the second-hand office market over the past two years. Several office blocks have been sold and two more at the Adelphi Centre, Dun Laoghaire, are for sale. Occupied by telecommunications group Ericsson under a 35-year lease from 1990, they are expected to fund will own two blocks of 54,500 square feet, which will be available for letting. A third block of 41,500 square feet will be retained by Crampton.

The first two blocks are likely to make about £5 million.

The ESB fund plans to reinvest £12.8 million in a new office development to be carried out by G and T Crampton at Shelbourne Road, Ballsbridge, Dublin 4. The be completed by early summer of 1998. With rents expected to range between £17 and £18 per square foot, the investment should yield about 7 per cent.

As part of the deal, the fund is to sell an office investment at 8 Wilton Terrace, Dublin 2, to Crampton. A value of £4 million has been placed on the block, which is occupied by National Irish Bank.