Investors eye purchase of €78m worth of Dublin logistics assets

With the Covid-19 pandemic serving to accelerate the growth of e-commerce and with traditional supply chains under pressure as a result of Brexit, the competition among international investors for industrial and logistics assets in Dublin and beyond shows no sign of relenting.

In the first instance, an as-yet unidentified party is understood to have entered into exclusive talks on the potential €53 million purchase of a portfolio of three warehouses being developed by Jordanstown Properties at Greenogue Logistics Park at Rathcoole in southwest Dublin. The party in question was selected following a targeted process directed by JLL.

Upon completion, blocks D, E and F will extend to 62,000sq ft, 72,000sq ft and 111,000 sq ft respectively, or a combined footprint of 245,000sq ft. The prospective purchaser stands to secure an immediate return on their investment in blocks D and F with long-term leases set to be signed on both properties.

In the case of block D, a leading UK logistics specialist is understood to be close to signing a 15-year lease with a break option in year 10 at a rent of €10 per sq ft. At block F, Zeus Packaging is understood to have already committed to a 20-year lease with no break option at a rent of €9.50 per sq ft. Block E remains available for letting.

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Developed by Palm Logistics, an affiliate of UK-headquartered Palm Capital and its local partner, Jordanstown Properties, Greenogue Logistics Park is well located within a two-minute drive of junction 4 of the M7/N7 and just seven minutes to the M50 (junction 9).

Elsewhere in the capital, Irish-owned logistics specialist JMC Van Trans looks set to secure about €25 million from the sale and leaseback of the new 150,000sq ft warehouse it has under development at Kingswood Business Park in Baldonnel.

JMC is understood to have agreed a deal with the purchaser, BNP Paribas Real Estate Investment Management (BNP Paribas REIM), which will mean it can occupy the property on a 25-year lease with a break option in year 15. Based on the expected rent roll of €1.4 million per annum, BNP Paribas REIM can expect to secure a net initial yield of about 5.18 per cent.

Intense competition

Upon completion, JMC’s new Baldonnel facility will extend to a gross internal area of 14,104sq m (151,814sq ft), and comprise 12,240sq m (131,750sq ft) of warehouse space along with 1,796sq m (19,331sq ft) of offices and staff facilities. News of the two deals comes amid a flurry of activity in the Dublin logistics market, with competition for both vacant and tenanted properties proving to be intense.

On the investment front, the largest transaction in recent times saw developer Michael O'Flynn and BlackRock Real Estate Assets securing €100 million from the off-market sale last November of the former Hewlett Packard campus in Leixlip, Co Kildare, to Swiss-based investor Stoneweg. The scheme comprises some 1.46 million sq ft of warehouse and office space and is set on a 195-acre site.

In terms of lettings, Mountpark is set to deliver the largest single "build-to-suit" pre-let warehouse ever in the Irish market at Baldonnel Business Park on behalf of Amazon.

As first reported by The Irish Times last December, the online retail giant has committed to the 654,000sq ft facility with a view to opening a new e-fulfilment centre.