National College of Ireland closing in on €50m Dublin docklands deal

The National College of Ireland (NCI) is closing in on the purchase of an office block from the Central Bank to facilitate the expansion of its main campus in Dublin's IFSC.

While negotiations between the parties are said to be at an early stage, The Irish Times understands the NCI has agreed to pay a figure close to the €50 million the Central Bank had been seeking when it offered the property to the market in March as part of the wider €105 million sale of Block R at Spencer Dock.

The building’s east and west wings, which are self-contained, were offered alternatively by selling agents Lisney in individual lots at guide prices of €55 million and €50 million respectively. The NCI, for its part, is pursuing the purchase of Block R’s west wing.

The property, which extends to 65,161sq ft (6,054sq m), came for sale with a commitment from the Central Bank to rent the ground to sixth floors (58,516sq ft, or 5,436sq m) and 23 car parking spaces on a short-term lease until September 2022 upon completion of the sale. The contracted rent in this instance equates to €3,017,800 per annum.

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Tesco Ireland recently signed a 20-year lease on the west wing's two retail units, with break options in years 10 and 15. Units 3 and 4 extend to 3,944sq ft and 2,701sq ft respectively and Tesco has agreed to pay a rent of €166,125 per annum, or €25 per sq ft (subject to final measurement).

The sale of the east wing at Block R meanwhile would appear to be on hold for now as the bank considers its options for the property. The majority of this building (53,856 sq ft, or 5,003sq m distributed across the ground to fifth floor, and 18 car spaces) is let to the Office of Public Works under a 20-year lease from May 2015, at a newly-agreed yearly passing rent of €2,636,424, which equates to €48 per sq ft, plus €3,750 per annum per car space. The OPW lease contains a break option effective in May 2027, giving the bank five years of guaranteed rental income and ample time to make a decision on the property’s future.

Designed by Scott Tallon Walker Architects and built by Johnny Ronan and Richard Barrett's former company Treasury Holdings in 2008, Block R at Spencer Dock, meanwhile, extends to a total area of 127,817sq ft (11,875sq m). The building, which was designed to be split into two self-contained wings (east and west) is located directly behind the Convention Centre Dublin and adjacent to Salesforce's new European HQ. Other office occupiers in the immediate vicinity include the NTMA, Microsoft, PwC, Credit Suisse, Custom House Global Fund Services, Optum (UnitedHealth Group), WeWork, Metzler, HubSpot and A&L Goodbody solicitors.

The proceeds from the sale of Block R, the plans for which have been in train since 2018, will be used to partially offset the €205 million the Central Bank spent in 2019 on the acquisition of blocks 4 and 5 at Ballymore and Oxley’s Dublin Landings scheme. The two buildings are being used to accommodate the expansion of the bank’s workforce.