Docklands and Tallaght offices for €8.6m and €4m

Two medium-sized office investments, one of them in the south docklands area of Dublin and the other in Tallaght, are to be offered for sale by private treaty later this week.

Marguerite Boyle of selling agent Savills is guiding €8.6 million for Hanover Court, a five-storey over basement building used as a data centre and office facility at the corner of Lower Erne Street and Hanover Street East in Dublin 2.

The investment will show a net yield of 9 per cent once standard purchasing costs are taken into account.

The asking price equates to €202 per sq ft (€18.76 per sq m), well below replacement cost.

Eamonn Richardson of KPMG is acting as receiver over the property after being appointed by Ulster Bank.

Hanover Court extends to 3,592sq m (42,542sq ft) and has 42 basement car-parking spaces.

The block is fully let to Verizon Ireland, a global group specialising in communications and IT solutions, which pays €810,000 per annum under a 25-year lease from 1999 with a tenant break option in 2020.

The lease is guaranteed by the tenant’s parent company.

Marguerite Boyle of Savills, who is handling the sale, said that given the excellent covenant strength, the specialised tenant use of the building and investor appetite for rack rented third generation offices, she anticipated that there would be very considerable Irish and overseas interest in the investment.

Hanover Court is strategically located close to the south quays and within 200 metres of Grand Canal Square and the Bord Gáis Energy Theatre.

Town centre investment
In Tallaght, Ross Fogarty of Knight Frank is quoting €4 million for the Grain House, a high quality third generation office investment in the town centre. The return of 14 per cent is one of the highest yields available in the Dublin market.

The six-storey block was developed by Bernard McNamara, one of the central figures in the collapse of the property market, and financed by Ulster Bank.

Declan McDonald of PwC is acting as receiver for the building which is producing a rental income of €592,251 from two State tenants, the Commission for Energy Regulation and the OPW.

The OPW, which occupies the two top floors in the 3,222sq m (34,688sq ft) block, has indicated that it plans to avail of a break option in 2014.

The energy commission’s lease of the remaining four floors from the same starting date also allows it to avail of breaks in years 10 and 17.