A UK fashion retailer will be paying a record rent for the premises of Pasta Café at 1 St Stephen's Green - which is expected to have knock-on effect in the area. And Laura Ashley faces a rent rise of 200 per cent.
A shop just off the top of Grafton Street in Dublin 2 has set a new Zone A benchmark rent for the area which will have a knock-on effect when a number of rents on the city's main shopping street are reviewed over the coming months.
The life assurance company, Friends First, which owns the building at 1 St Stephen's Green (one door off Grafton Street), has negotiated a rental increase of almost 90 per cent after buying the lease from Pasta Café for more than €1.2 million.
The new tenant, UK fashion retailer Reiss, will be paying a rent equating to €5,188 per sq m for Zone A - a full 26 per cent more than the going rate of €4,090 on Grafton Street. The increase is all the more remarkable because the building is not even on Grafton Street, according to Roger Mansfield of Friends First.
He said it had been widely believed that the shop in question was under-rented and in time, the new letting proved the point very well.
Pasta Café is currently paying a rent of €225,000 and when Reiss moves in next month, the rent will rise to close to €500,000. Although the shop has a ground floor area of 297 sq m (there is also storage space of 120 sq m on the upper floors) the volume of Zone A space is relatively small because of the narrow street frontage.
Mervin Ellis of Palmer McCormack, who handled the acquisition of the lease and the subsequent letting, said it was hardly surprising that there was so much interest in the shop because units with over 278 sq m were unusual in this area.
However a number of traders approached were not interested because it was not a Grafton Street adddress.Reiss caters for the top end of the fashion market and has 20 stores in top UK locations like Bond Street and Covent Garden.
The next rent to be fixed in Grafton Street will probably involve the fashion retailer Serena, which is taking over the footwear specialists Scholl at 57 Grafton Street. Scholl has been trading out of the shop for about 40 years and is paying a rent of €150,000 for the 114 sq m shop and 60 sq m basement.
WITH the next rent review due in February, Irish Life has opened discussions with the Serena owner on creating a new lease for the entire building - the three upper floors are sublet to other tenants.
Another Grafton Street shop facing a significant increase in its rent is Laura Ashley, which occupies 1,114 sq m (with two floors of retail on 445 sq m) in one of the best-located buildings on the street. The company is paying a rent of €350,000 but as rent reviews are every seven years rather than the customary five years, the size of the increase will invariably be higher.
The company is likely to face an increase of up to 200 per cent, pushing it up to around €1million, according to sources in the retail trade.
Like 1 St Stephen's Green, the Laura Ashley building is also owned by Friends First. David Potter of Palmer McCormack handles rent reviews for the company.
