The commercial property investment market is finally to spring into life in the coming weeks with a range of investment opportunities due to become available for private buyers.
Two newly occupied office buildings in Cork Airport Business Park are going on sale today along with 11 freehold offices formerly occupied by First Active. The building society is also selling nine freehold properties as part of the restructuring of its business.
Several other interesting investment properties are also scheduled to come on the market in the Dublin area this autumn as owners prepare to cash in on the phenomenal growth in values over the past few years. Ann Hargaden of Lisney says that while some private investors are likely to offload properties which have done exceptionally well in recent years, prime investments would remain scarce.
Institutions were reluctant to offload even their smallest investments because of the limited opportunities for reinvesting in property and the huge inflow of funds for which they had to find a home, she said. However, some institutions are known to be anxious to sell investments valued at under £5 million to allow them to concentrate on larger lot sizes. The fact that the market has now peaked and interest rates continue to edge up may also encourage others to take their profit at this stage.
Lisney is handling the sale of the two Cork office investments, which carry enterprise zone capital allowances. The agents are quoting a guide price of over £4.25 million - equating to a yield of 5.3 per cent before tax breaks - for an 18,244 sq ft building rented by Black & Decker and by Globe Technical Services at £229,000 per annum.
The sale includes 81 car-parking spaces. The second building of 11,183 sq ft with 44 spaces is let to Com 21 Ireland at a rent of £146,770. It is likely to make in excess of £2.6 million.
The business park is being developed by Omnistone Ltd in a joint venture with Aer Rianta and ICC Bank. It has already attracted a number of high-profile companies including Pfizer, Eirx Therapeutics, Motorola and Analog Devices. When completed, the park will have more than 490,000 sq ft of high tech buildings as well as a hotel and ancillary facilities.
Nigel Kingston of Douglas Newman Good Commercial reports strong interest in the sale of the First Active portfolio, which includes premises in Dublin and the provinces. The highest price of over £625,000 is likely to be obtained for the 9,000 sq ft premises at Nutgrove Shopping Centre in Rathfarnham, held under a 10,000 year lease, but subject to an annual service charge of £5,655.
Another strong seller will be the three-storey corner building in Enniscorthy which should make in excess of £475,000. A single-storey building with almost 1,400 sq ft at Camden Street Lower in Dublin is likely to make over £450,000. Similar guide prices are being provided for a two-storey freehold building at Rosemary Avenue, off Eyre Square in Galway, and also for a four-storey block at Pearse Street in Nenagh.
Also going for sale is a two-storey corner building at New Market Square in Mitchelstown, Co Cork, which is likely to make over £300,000; a two-storey mid-terrace commercial building at Bridge Street, Balbriggan, Co Dublin, valued at over £240,000; a three-storey building at Patrick Street, Tullamore, Co Offaly, likely to fetch more than £225,000; a three-storey premises at Main Street, Tipperary town, which should make at least £200,000 and a two-storey building at Chapel Street, Carndonagh, Co Donegal, which should exceed £100,000.
The most interesting leases going for sale are at 91 Grand Parade in Cork, which should sell for over £50,000 and at 97 Sandymount Road, in Dublin 4, valued at over £40,000.
