Six in chase for Starwood’s €550m office portfolio

The sale by US property giant Starwood of a portfolio of five prime Dublin office assets with an indicative value of €535 million has attracted offers from six parties in the first round of bidding.

Goldman Sachs, Apollo, Blackstone, Tristan Capital, Avestus and Westridge Real Estate are all understood to have submitted bids for the Cedar portfolio last Wednesday at levels in and around the price being sought by joint agents, CBRE and Eastdil Secured, a subsidiary of Wells Fargo Bank.

The portfolio comprises a number of landmark office properties, including the Watermarque building, 75 St Stephen's Green, Iveagh Court, Marsh House, 29-31 Adelaide Road, and 1 and 2 Parkgate Street.

Distributed across Dublin’s central business district, the properties comprise 600,737sq ft of office accommodation and 45 residential units.

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Biggest asset

Iveagh Court is the portfolio’s biggest asset by size and rent. Developed by Sean Reilly’s McGarrell Reilly, the Charlemont Street property extends to 220,938sq ft and is generating €10.44 million – or 36 per cent of the portfolio’s rent – from tenants which include WeWork, Mercer and the OPW. It is understood the building has been ascribed a value of about €200 million for the purposes of the sale.

Arguably the most high-profile property included in Starwood's sale however is 75 St Stephen's Green. Built by Garrett Kelleher's Shelbourne Developments, the property extends to 102,485sq ft and is occupied by several blue chip tenants including Maples, Avoca (KKR), Hedge Serve and Cantor Fitzgerald.

Starwood’s decision to dispose of the Cedar portfolio is understood to have been prompted by an unsolicited approach from Iput earlier this year, which placed an indicative value of about € 555 million on the assets.

Having considered the approach, Starwood opted to offer the portfolio to a select number of national and international investors through CBRE and Eastdil Secured. The current sale process is expected to secure at least €550 million for the US-headquartered real estate investor.