A range of parties are expected to vie for ownership of two Dublin city-centre office investments, both of which are generating strong rental income from state-backed tenants.
The properties, at 88-94 Capel Street and at 16-22 Green Street, are being offered to the market by agent Savills at guide prices of €6.5 million and €7 million respectively.
The property at 89-94 Capel Street is a five-storey office building extending to 2,329.4 sq m (25,073sq ft). Situated at the northern end of the street, close to its junction with North King Street, and adjacent of the Technological University Dublin Bolton Street campus, the property has a B2 Ber rating and is about 84 per cent let to the Office of Public Works (OPW) with the remaining income generated by Autoaddress.
The OPW is an established occupier within this location, having been there since 2002. The property is producing a total rent of €709,550 a year, with a weighted average unexpired lease term of about 1.9 years to the nearest break option and about 7.4 years to expiry.
The OPW committed to a new 10-year lease in 2022. Autoaddress occupies a self-contained ground-floor office unit and has been in occupation since 2020. The property offers good tenant amenities including secure car parking, shared bicycle parking, end-of-trip facilities and a communal courtyard.
The guide price of €6.5 million reflects a net initial yield of 9.93 per cent after standard purchaser costs.
The property at 16-22 Green Street is a well-located office building of 2,777.5sq m (29,897sq ft) set on a prominent corner site. State-backed entities occupy the majority of the assets through the Irish Human Rights and Equality Commission (IHREC) and St Michael’s House.
The property is producing a current gross passing rent of €426,951 yearly. The selling agents expect this figure to increase in May to about €479,950 a year following the index-linked rent review of the IHREC premises.
In addition, a vendor underwrite on the available office spaces amounting to €135,000 a year ensures an overall rent roll of about €614,950 annually.
The property has a weighted average unexpired lease term of 5.6 years to the nearest breaks and 8.3 years to expiry off the in-place income.
This investment offers asset-management potential through the letting of the penthouse (fourth) floor and lower-ground floors. These recently refurbished B3-energy-rated floors have been finished to a high walk-in standard, the agents say. The property at 16-22 Green Street offers good tenant amenities including secure car parking, shared bicycle parking, end-of-trip facilities and a communal courtyard.
The guide price of €7 million reflects a net initial yield of 8 per cent after standard purchaser costs and a capital value of just €234 per sq ft.
The Capel Street and Green Street buildings are in a central location, offering access to a wide range of amenities. They are well connected, with Luas, Dart and Dublin Bus routes close by.
“These properties offer investors an opportunity to acquire city-centre office investments underpinned by strong government or government-backed income,” Kevin McMahon of Savills says.
“89-94 Capel Street and 16-22 Green Street are being offered for sale individually, but given the adjacency of both buildings, savvy investors may explore the prospect of acquiring both to unlock a substantial 0.43-acre site.”
