OfficeInvestment: An interesting office investment comes on the market today with the sale of the O2 Customer Care Building at the National Technology Park in Limerick.
Thomas Carthy of Atis Harrington Bannon is quoting €8.5 million for the six-year-old building, a price that would equate to a net return of 6 per cent.
The high-spec three-storey office building has a floor area of 3,000sq m (32,500sq ft) and there is also an adjoining "switch gear" building of 538sq m (5,709sq ft). The buildings stand on a site of 1.34 hectares which offer future development potential and 178 car-parking spaces.
Both buildings are held under 25-year full repairing and insuring leases from the end of 1998 at a current rent of €520,000 per annum. The leases provide for five yearly upwards-only rent reviews and a break option at the end of year 15 subject to 18 months prior notice.
The agents say that the purchaser will be able to avail of a substantial saving in stamp duty as the property is held in a special purpose company - Bridgehead Property Ltd.
O2 is a leading mobile communications provider in Ireland with revenues for the year up to March last of €720 million. The company is a wholly owned subsidiary of O2 plc which is listed on the London and New York stock exchanges.
The O2 group has 20.7 million customers and 12,000 employees. According to Thomas Carthy, there should be considerable interest in the Limerick investment bearing in mind the quality of the buildings, the stamp duty saving and the strong covenant.
